Leaky homes service gets shake-up

The Government today announced measures intended to get leaky homes fixed faster, and better hold builders to account.

Building Issues Minister Clayton Cosgrove said the changes amount to a major shake-up of the Weathertight Homes Resolution Service (WHRS).

They would improve WHRS assessment reports, information and case management, result in faster and more effective claims, speed up dispute resolution processes and create a co-ordinated approach to resolving multi-unit claims, he said.

The Government set up a resolution service to help out homeowners hit with shoddy materials, design and workmanship, but it has been heavily criticised for a lack of progress.

A two-year pilot lending assistance scheme would be set up, providing loans at market interest rates and loan guarantees, effectively as bridging finance.

The scheme will aim to help people repair their homes, without waiting for settlement.

"Homeowners will receive a more accurate and comprehensive assessment of the damage to their house and what work is needed to repair it," Mr Cosgrove said.

They would be able to claim costs for a wider scope of damage and average time for claims to be resolved was expected to nearly halve.

The building industry welcomed the changes though Registered Master Builders chief executive Pieter Burghout said they "increased potential liability for builders".

He said: "We are particularly supportive of the Government's efforts to protect both builders and consumers.

"An example of this is the payouts of claims will be registered on the LIM report."

A report last year estimated 15,000 homes could suffer damage from leaks -- 3000 more than the previous highest official estimate.

The cost of repairs on leaky buildings has also been revised upwards to about $1 billion -- about five times the previous Government estimate, a Department of Building and Housing paper to the Cabinet said last year.

A report last year estimated 15,000 homes could have suffered damage from leaks -- 3000 more than the previous highest official estimate.

The cost of repairs has also been revised upwards to about $1 billion, five times the previous government estimate.

Mr Cosgrove confirmed those figures today, and said the scope of the damage that could be claimed for was going to be widened.

Over four years, $30.5m is allocated to clearing up WHRS. An additional $7.1m is for loan assistance.

Mr Cosgrove hinted that he believed some lawyers were delaying the resolution process because it was in their interests to do so.

He called it "gaming the system" and said it happened in other industries as well as building.

"Everyone knows this is a heart-wrenching issue for ordinary kiwis," he said.

Within the package there is $1m for a public education programme aimed at ensuring home builders and buyers have all the information they need to make sound decisions and that contracts, as well as their houses, are watertight.

- NZPA