"Because of those financial implications we think there is a real risk of entering a stage of what we term demolition by neglect."
Council has already received an application to demolish 1 Victoria Ave.
"The pendulum has already swung," Mr Lampp said.
Council already has some financial incentives in place such as its building assessment fund, rates remissions and consent fee waivers but Mr Lampp said it was not enough.
"Really, none of those three offer anything significant or meaningful... in the context of cost involved."
He asked the committee to approve investigating a rate-funded heritage grant scheme.
The focus would be on preserving facades and verandas rather than entire buildings, he said.
"I think we need to look at what elements of the buildings we want retained and what are the costing implications of retaining that fabric," he said.
"And when you break that down, it may be more cost effective than what you're being told by property owners, possibly."
Councillor Helen Craig said she would support a grant scheme through council's ten-year-plan.
"We need to do this and we need to do it now," she said.
"Whanganui has the largest number and concentration of heritage buildings compared to anywhere else in New Zealand.
"I think it's almost one of our biggest risk. If you look at tsunamis, earthquakes or whatever, actually losing our heritage is one of our biggest risks."
She said heritage buildings were a reminder of the city's history.
"It's that wonderful thing that gives us the warm fuzzies when we walk down the street... and if we lose that we're going to end up with a whole lot of glass concrete buildings, we'll end up with a whole lot of empty spaces."
Council staff will now consider budgets and implementation plans and bring the matter back to the committee.
"I would describe this as a very cautious and thoughtful approach to supporting where we want to be in preserving our heritage," committee chair Kate Joblin said.