Roger Levie: Leaky home rescue plan barely scratches surface

Many owners of leaky homes do not qualify for the Government's rescue package.

Opinion

It is hard to avoid the conclusion that the Government's leaky homes rescue package is nothing more than a sideshow designed to distract attention away from the severity of the problem we face.

Although the PricewaterhouseCoopers (PwC) report, commissioned by the Government to quantify the size of the leaky home problem, had a consensus forecast of 42,000 homes likely to fail, the fact is that all plaster-clad homes built between 1992 and 2005 have now lost value, whether they are leaking or not.

Many of the owners of damaged homes do not qualify for the Financial Assistance Package (FAP) or have any other opportunity for a financial contribution to assist with repairs.

And the evidence now shows that, as expected, it's not just plaster-clad homes that are failing - not surprising as many other homes have the same poor detailing that has allowed water into plaster homes.

When you take this all into account, the result of the deregulation of the early 1990s, and the opportunism and greed that has crept into the building environment unabated, is now having an impact far in excess of that forecast in the PwC report.

To give some perspective, more than 400,000 homes were built in this period of risk - a little under 25 per cent of our current housing stock. Many of these will be affected in some way. To keep thinking about this as a leaky home problem would be foolish.

Many of the owners of these affected homes will have been following good Kiwi tradition and building equity in their properties as a means of saving.

Now they are seeing their wealth quickly eroded with a significant impact on long-term security.

And in the worst situations, families continue to live in damp, mouldy homes with no hope that they will ever have enough money for proper repair. The impact of this, especially on the health of our children, is tragic.

This week, New Zealand Herald readers got to see the Government's response to recent criticism of the FAP. In an article headed "Leaky payout plan works - Govt", the retort was that 24 homeowners had received full contributions under the FAP as opposed to the 12 mentioned the previous day.

And in the same article the Minister responsible, Maurice Williamson, reminded us that "this Government was the first to offer assistance to owners of leaky homes after nine years of Labour ducking responsibility".

What has of course been conveniently overlooked in the spin is that it was the previous National government that made the changes that led to the problems Labour is now accused of not cleaning up.

On Wednesday evening, I watched President Barack Obama deliver an inspiring acceptance speech full of belief and passion, with a message of conciliation and hope.

He spoke of the fact that, despite their differences, most Americans share similar hopes for their country.

That got me thinking that we are no different. I'm sure that we share a vision where all our citizens live with their families in warm, secure homes in caring communities. The question is, how can we make this happen when our political leaders seem to think that payouts on 24 homes under the FAP is a meaningful response to a problem affecting hundreds of thousands of people?

When faced with a huge problem with such a dramatic impact on the fabric of our country, I would hope for a much more mature response from our politicians.

I accept that the financial impact of the problem is so large that it is unrealistic to think that in the current climate the Government could offer a financial contribution that would make a significant difference across the board. However, I would have thought the focus of any programme must be to make the limited funds available go as far as possible, minimising the bureaucracy.

If we are prepared to get creative there are so many ways Government, councils and industry could help other than through direct financial assistance.

As an example, it is heartening to hear that Tauranga City Council is now discounting building consents for leaky homes. Others should follow suit and broaden their thinking. The starting point to finding a meaningful solution must be an in-depth inquiry and a sharing of understanding between all those affected and involved, so that together we can work out the right questions and come up with effective responses.

This can't come soon enough, particularly given the other significant challenges that we face around housing affordability and supply.

Roger Levie is chief executive of the Home Owners and Buyers Association of NZ.