Australia is facing a $6.3billion bill to repair the water leaks, fire safety breaches, structural failure and combustible cladding plaguing homes built in the last 10 years, according to a new study.
New research found more than 3,400 apartment buildings, containing about 170,000 apartments, were fitted with combustible cladding which needs to be fixed, a study undertaken by Equity Economics on behalf of the Construction, Forestry, Maritime, Mining and Energy Union showed.
Of those, about 1411 buildings are in NSW, with 95 of those classified as being at ‘extreme risk’, while 1069 buildings were identified in Victoria.
More than 500 of them are at high risk, and 72 are extreme risk.
The cost of repairing Australia’s shoddy apartments will exceed $6billion, with 3,400 buildings in NSW and Victoria alone found to have been fitted with combustible cladding. Pictured:Melbourne’s Lacrosse tower in Docklands, which went up in flames in 2014 due to building defects
Mascot Towers (pictured) was evacuated on June 15 after large cracks began to appear in the car park
The figures come eight months after residents of Opal Towers were evacuated on Christmas Eve due to structural failure, and only two months since the 132 apartments making up Mascot Towers were cleared out.
While the NSW Government has offered no-interest emergency loans to the residents of Mascot Towers, the money is a ‘one-off’, and will need to be paid back after it was established who would need to cover the costs of the repairs.
CFMEU Construction and General Division National Secretary Dave Noonan said unfortunately homeowners would likely be the ones to foot the majority of the bill.
‘Australia’s building and construction crisis will cost [owners] a staggering $6.2 billion – to fix apartments they’ve already paid for,’ he said.
‘This includes the cost of remediating water leaks, fire safety breaches, structural failure and combustible cladding, and costs associated with increased insurance premiums, legal fees and alternative accommodation.’
Mr Noonan said the cost to an individual family could exceed $150,000 – a price many would struggle to afford.
‘In some cases, the costs of this remediation has been up to $165,000 per dwelling – enough to sink many families,’ he said.
‘Tens of thousands of families, many of whom have purchased their first home, are now stuck with the crippling cost and mental anguish of owning homes that they may not be able to live in, are unsafe and cannot afford to repair.’
Residents of Opal Tower in Sydney’s Olympic Park were evacuated on Christmas Eve 2018, and many are still unable to return home after massive cracks were detected in the building
The Victorian Government announced a $600million package to repair buildings tainted with combustible cladding, though the NSW Government has failed to follow suit.
Building Comissioner David Chandler told the Sydney Morning Herald he would consider recommending low-interest government loans for owners affected by the crisis to put towards their repair bills.
Mr Noonan blamed deregulation of the construction industry for the damage, which has diminished oversight and accountability of developers.
‘Often, it has fallen on the union to blow the whistle,’ he said.
‘This is the result of the construction industry’s obsession with ‘deregulation’ at any cost, and poor oversight by government.
‘It’s the result of years of not enforcing building standards and of allowing industry to ‘self-approve’ with little or no oversight.’
The newly built block (pictured) was cleared out after residents felt shaking and heard cracking