One step closer to leaky home resolution?

The government has taken a "giant step in the right direction" when it announced today it would increase the amount it is prepared to contribute towards repair costs for leaky home owners.

Monday, May 17th 2010, 5:11PM

by The Landlord

Building and Construction Minister Maurice Williamson announced that the government will pay 25% of repair costs, with local authorities also footing 25% of the bill, with the remaining 50% to come from property owners.

However, home owners will forgo their right to sue local authorities or the crown if they take up the government's offer, although will still have the option to pursue other liable parties such as builders, developers and manufacturers of defective products.

Williamson says the scale of the leaky homes issue is equivalent to a natural disaster of huge proportions and it is having a considerable impact on the wealth and health of many thousands of New Zealanders and their families.

"Affected home owners have been stuck in a complex and costly disputes process for too long with little prospect of being able to fix their leaky home," he says.

Although the government still firmly denies any legal responsibility, Williamson says "the magnitude of the issue means central government involvement is essential if we are going to find a way forward".

Home owners will be able to apply for a loan guarantee underwritten by the government for their half of repair costs, provided they meet bank lending criteria.

North Shore mayor Andrew Williams says "the rescue package is a giant step in the right direction with the government finally accepting their fair share of responsibility for this man-made national disaster".

Affected property owners will need to make a claim under the Weathertight Homes Resolution Services Act to access the package once it is launched.

Williamson says the government is aiming to have the package up and running early next year, but in the meantime people can apply to the Department of Building and Housing to make a claim.

It is thought over 80,000 people live in affected houses, but only a minority - around 3,500 - have been repaired to date.

"If, as officials forecast, 70% of affected home owners within the 10-year liability limit take up this package, the government is anticipating its share will be around $1 billion over the next five years," Williamson says.

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