Wellington is facing a looming property crisis with 229 strengthening deadlines for earthquake-prone buildings due to expire in 2027 alone, which could leave hundreds of residents homeless.
There are 572 earthquake-prone buildings in Wellington, of which 52 are residential apartments equating to 980 units.
The number of notices that expire in 2027 makes for an alarmingly sharp peak.
Wellington City Council city development manager Phil Becker said the council has blunt tools available to it when buildings become uncompliant.
Owners can be liable for a fine of up to $300,000, or $1.5 million for a body corporate. The council can also take over buildings, strengthen them, and charge the costs back to the owners.
“But the scale of the problem ahead of us makes that an impractical option,” Becker said.
He doubted the construction market had the bandwidth to deliver the amount of work required to make the buildings safe by 2027.
“You do get a strong sense of the intractability of what we’re dealing with.”
Councillors were told in a briefing this afternoon that while the closure of buildings would immediately address some safety issues, the associated social and economic costs for the city would be significant.
“Closure of buildings contributes to social distress, financial loss for property owners, home displacement, and broader implications for the city, including economic repression, disruptions to transport networks, and a reduction in available housing stock,” council documents said.
Wellington City Council chief planning officer Liam Hodgetts said the rules were black and white but there was some discretion in how the council applied them as the regulator.
“There needs to be a sense of progress made and there are building owners out there who aren’t doing potentially what they could be doing.
“There are building owners out there who are desperately trying to achieve the rating that they require to continue to live in the building but there are other forces at play that prevent them from reaching that.”
Council officials have been heartened by comments from new Building and Construction Minister Chris Penk that he would consider moving a scheduled review of the earthquake-prone building system forward or pushing out deadlines, if appropriate.
At the briefing, council officials presented options on how Wellington City Council could advocate to the new Government for help.
Suggestions included asking for a three-year extension to earthquake-prone building notices while an independent review of the system is carried out to ensure it is fit for purpose based on real-life experiences to date.
Another avenue the council could explore is increasing the amount owners can borrow under Kāinga Ora’s loan scheme. Currently, residents can borrow up to $250,000 if they are an owner-occupier of a unit who can demonstrate they cannot get a loan or if securing one would cause significant financial hardship or mean selling their home.
A Ministry of Business Innovation and Employment pilot support scheme could also be extended beyond the ten apartment owner groups it was originally designed to support.
The pilot includes free legal and engineering advice for owners to help them understand their options and collectively agree on a remediation plan.
Georgina Campbell is a Wellington-based reporter who has a particular interest in local government, transport, and seismic issues. She joined the Herald in 2019 after working as a broadcast journalist.