So what happened? Well it was a perfect storm of mismanagement, incompetence and ignorance. It’s a fascinating case study, so grab a cup of tea and maybe a biscuit or two. Sitting comfortably? Excellent, so here goes........
Under pressure from the building industry, who for years had been complaining about the high cost of compliance with the building standards and the restrictions it created for generating cost efficiencies, the government set up the Building Industry Commission. The result of this review was The Building Act 1991, which passed into law in 1993. Whist simplifying New Zealand’s numerous codes and acts into one piece of legislation, it also changed building controls from a prescriptive system to a more self-regulated regime. Sounds innocent enough but it had disastrous consequences. It was supposed to free the building industry from the shackles of meeting specific building standards and given them the freedom to provide homes that meet a performance standard; and in doing so drive innovation and speed up construction. It seemed like a win-win. Unfortunately it was badly written.
In particular there was a lack of emphasis upon the fact that a residential buildings needed to provide shelter to occupants; being both weathertight and durable. And as the weathertightness of a building was fundamental to achieving many of the other provisions in the Code, residential properties were doomed even before a spade hit the ground.
Unfortunately the legislation didn’t really address what would happen if the buildings failed to meet the performance standards and created a power imbalance between the home owner and the supplier. Market forces were a poor regulator and insufficient to protect the home owner and without protection in the Act or elsewhere the outcome was inevitable.
To compound the issue, the Government dropped the apprentice training scheme for builders and the related building trades. Whilst the effects of this weren’t immediate, over the long term the quality of the workmanship deteriorated and compounded the problems that the Act has already created. If homes can’t be built well enough how can they meet the performance standards intended? Faced with limited powers, Local Authorities reduced the number of active inspectors and became less focussed on this self-regulating industry than perhaps was needed.
Perhaps the problem wouldn’t have been quite as catastrophic had this not coincided with a fashion for Mediterranean style buildings; houses with complex roofs, plastered exterior walls, internal decks and small or no eaves. These had become all the rage and, now freed from the constraints of a prescriptive building code, architects and builders could get really inventive. The building boom was on and an average of 22,000 homes a year were being built in all manner of shapes, sizes and colours. With home owners’ desire for indoor-outdoor flow, cubism, flat roofs, more and more complicated architectural designs were being produced at an astonishing rate. Unfortunately the building industry wasn’t ready or skilled enough to construct these homes to level of accuracy needed.
The problem lay in the exterior cladding, the skin of the building. Monolithic cladding systems were promoted as being low maintenance and efficient in providing a sealed waterproof outer skin. Such cladding systems typically allowed for little construction or thermal movement so that fine cracks that appeared insignificant, and would have been relatively insignificant in traditional claddings such as weatherboard, allowed continuous ingress of moisture into the framing. These, combined with reduced air movement through the prevalence of sheet cladding or sheet insulating materials for the monolithic look cladding, resulted in very damp conditions which were ideal for rot.
This would’ve been bad enough, but things were about to get a whole lot worse. In 1995, again from pressure from the building industry, there was a change to the New Zealand Standard for Timber Treatment. This allowed the use of cheaper untreated timber for wall framing. Not a problem if the material didn’t get wet but when placed within leaking monolithic clad buildings the outcome was disastrous.
It could be argued that the Mediterranean style of building wasn’t necessarily conducive to New Zealand weather conditions. Along with the sunshine, our sub-tropical climate brings high rain and high winds, and in Auckland vertical and horizontal rain. Homes built in the Mediterranean style 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
The lack of teeth in the Act meant that corners were being cut; time wasn’t being spent in the design process, drawings weren’t detailed enough and some builders were unable to make a weathertight structure without proper guidance. Due to the lack of an apprentice scheme, there simply wasn’t enough skills in the New Zealand building industry to construct these complicated homes to a sufficient standard. Equally, Council staff carrying out the building inspections had neither the required construction expertise to ensure weathertightness nor the intuition to look for it.
So the monolithic cladding system’s failed, the untreated timbers became damp and started to rot. Encouraged by the warm and damp, climate, moulds and spores developed within the damp timber framing resulting in building that were too unhealthy to live in. In extreme cases, timbers were so badly decayed that the whole structure became structurally unsound. Beautiful looking, multi-million dollar homes essentially collapsed from the inside out.
Eventually the Building Act 1991 was replaced by the Building Act 2004, which introduced a licensing scheme for building designers, builders and related trades. Councils were required to be registered with a central authority and were to be subject to regular quality control procedure checks. Interestingly, Council building inspectors remain unlicensed. For the tens of thousands of people who bought homes built between 1990 and 2004 it was cold comfort. The damage had been done and the impacts are still being felt today.
A government compensation scheme was put in place to help those who were effected but this is only likely to fix around 3,500 of the properties built during that time. The government has imposed a 10 year limit after construction on claims, even though some building experts believe many cases will only become apparent during coming years, as building rot becomes advanced enough. They also warned that houses in drier parts of New Zealand were now starting to show problems, which had simply developed at a slower pace.
Even today, if you walk around Auckland, you will see buildings wrapped in white plastic. Before reading this blog, you could be forgiven for assuming that they were simply being protected whilst the owners were having the house re-painted. Instead, it’s yet another building being stripped of its cladding and fitted with weatherboards. There was a reason that the traditional New Zealand villas were built with timber weatherboards.
And this all could’ve been avoided had a little more thought been given to the requests of the industry. There was already a perfect example of what might happen on the opposite side of the Pacific. In the 1980s, just ten years previously, British Columbia in Canada had the leaky-condo crisis where, you guessed it, regulations were relaxed and problems emerged with water penetrating the outer skin of building designed in the Post Modern style. Or as some might call it then Mediterranean style.
So the next time you hear an argument to let an industry self-regulate, and indeed are tempted to agree, just consider for a moment what are the potential outcomes? Who is going to benefit and what are the risks? Leaving it to the experts is one thing but what happens when market pressures start to influence decisions? In the end someone has to pay whether it’s the person buying the home or the tax payer burdened with clearing up the mess.
