Leaky homes crisis

An architectural design trend towards Mediterranean-style houses with complex roofs, plastered exterior walls, internal decks and small or no eaves also factored in.

Many buildings built in the "Mediterranean" style used these types of cladding and had features such as recessed windows, flat roofs, minimal eaves, multiple storeys, complex roofs, solid balustrades, balconies and penetrations of the exterior cladding that increased the likelihood of water infiltrating the structure.

[11] A crash research-project by the New Zealand Forest Research Institute to, amongst other objectives, attempt to identify how the new crop Radiata could safely be used in construction took place between 1995 and 1998.

[14] Some of the Acceptable Solutions to the Building Code were re-written, most notably E2/AS1 External Moisture which covers the detailing of roofs and walls was greatly expanded.

In its final 2002 report the Overview Group recommended to the BIA that research be conducted as to whether there were any "issues regarding the structural strength and durability with respect to the maturity of timber".

[17] The majority of affected buildings are homes or apartments, but in 2011 the twenty-year-old Ronald McDonald House for children with cancer and their families at Wellington Hospital was demolished as leaky and replaced.

[22] As of mid-2009, plans for an up to NZ$6 billion bailout package shared between government and local authorities are in doubt because the amount could affect New Zealand's international credit rating.

[24][25] Prime Minister John Key noted that while claimants did not have to accept the settlement, legal costs for bringing suit could eat up any further money awarded to them.

There have also been accusations that parts of the legal and inspection professions are profiting substantially from disputes around the cases, and that significant money was diverted into these channels rather than into fixing the buildings.

[27] Further, National was also criticised that as an opposition party, they had constantly asked for the then Labour-led government to assist homeowners financially.

[17] In February 2010, New Zealand's Building and Construction Minister Maurice Williamson, National, warned that the size of the issue, at least $11 billion, was so gianormous [sic] that even a government with budget surpluses would struggle.

He also warned that it was necessary to come up with a solution so money could be spent on fixing houses, rather than paying lawyers, and that there was a risk of significant rates rises in the major centres like Auckland, Tauranga, Wellington and Christchurch, of a scale that would "make eyes water".

Despite the FAP offering to give the homeowners the certainty of financial contribution and to help get leaky homes fixed faster, by November 2012 only 12 victims had received final payouts under the government scheme.

It is commonly known in Canada as the Leaky condo crisis and has been an ongoing issue that is estimated to have caused $4 billion in damage since the 1980s.