Kerre Woodham: Will a fine solve our dodgy building problems?

There's been a lot of good news on the home building front, you know, just for your average homeowner.  

The Government's plans to reform the building consent system to make it more affordable to build a new home – or a home. Jolly good news. The review of the building code to bring in a streamlined, risk-based consenting regime, as well as increasing the availability of construction materials, all good.  

There is no doubt we're paying through the nose to build homes here. The cost of building work consented per square metre for a standalone home in New Zealand in 2022 was $2591. In Australia it was $1743. So expensive. The total number of homes consented was in decline too. In the year to December 2023, 37,239 dwellings were consented, down from 49,538 the previous year. The government's proposed law changes, which will remove the need for building consents on homes under 60 square metres in certain areas —your granny flats— those changes have been welcomed by housing providers and also the opposition, so this is all good news, very good news.  

The Coalition government pitched the changes as a way to make it easier to build granny flats, tiny homes, and increase the supply of affordable housing. All well and good. My only concern when I heard the news was where are the checks and balances in terms of the quality of build? As Chris Penk put it, reforms around consenting homes and removing barriers to overseas building products will only succeed if we have qualified tradespeople doing the work, standing by it and being accountable if things go wrong. We've needed that for many, many years.  

When you look at the buck-passing around the leaky homes debacle that devastated the lives of so many New Zealanders, nobody was willing to take the blame, and I'm not saying the builders were at fault, but nobody was.  Nobody was held accountable. Ratepayers ended up having to fork out huge sums of money to try and remediate the worst disaster that they could possibly have. Sinking every cent they had and future funds that they were going to generate into a home that was unliveable. How do we ensure that the work done is done right, especially when you hear tales of undercutting and people coming in and doing a job for next to nothing because they've got friends and family and relatives, and they're all living together in one big house?  

This is the complaint made by your professional builders who pay the going rate, don't undercut, know what a job is worth, and charge accordingly. How do you protect consumers from that? In the first instance, I'd say buyer beware. Don't just go for the cheapest price. If something sounds too good to be true, then it is. But most of us know very little about structures and engineering and building. When you go into a home, you expect that it has been built to last, as many homes have. And in more recent times, many homes have not. How on earth do you check that a building has been done properly, that in an addition, an add-on has been done properly? The unconsented tat that I had to pick my way through when I was trying to find a house at the height of the market, was just horrific. Even though I don't know anything about building, you know that when something's dangling off the edge of a Cliff held together with a piece of four by two, chances are it hasn't been consented. Some of the building inspections showed that it hadn't been consented. Things had popped up on the floor plan out of the blue. And it all went so far back that there was no ability to be held accountable. You just had to buy it aware that you could be buying into a whole load of problems, and these were houses that were going for millions in Auckland.  

The Government says that it's going to crack down on dodgy builders. That, as Chris Penk says, all of these improvements will only work, will only benefit consumers ultimately if the building is of a professional quality. So the crackdown looks to lift the competence and accountability requirements for building professionals, improving consumer protection measures in the Building Act and ensuring regulators have the right powers to hold people to account. It really counts for nothing. All very well and good to have a potential fine of $50,000 for an individual builder and $150,000 for businesses to deter bad behaviour, but since when has it?  Some of these shonky builders that people employ, they haven't got $50K. You can whistle for your $50K. $150,000 for businesses to deter bad behaviour. Can I show you the Du Val group who have lost hundreds of millions and are now applying for legal aid? You're not going to get $150K out of them.  

So all well and good to lift the accountability requirements and the competency of building professionals but ultimately, we are all still going to be left just hoping and trusting that we've employed the right guys or girls. I've been v

Episode Transcript

Speaker 1 (00:06):
You're listening to the Kerrywood and Mornings podcast from Newstalk
sed B.

Speaker 2 (00:11):
There's been a lot of good news on the home
building front, you know, just for your average homeowner. The
government's plans to reform the building consent system to make
it more affordable to build a new home or a
home which on a good news. The review of the
Building Code to bring in a streamlined, risk based consenting regime,

(00:34):
as well as increasing the availability of construction materials all good.
There is no doubt we're paying through the nose to
build homes here. The cost of building work consented per
square meter for a standalone home in New Zealand in
twenty twenty two was two thousand, five hundred and ninety
one and Australia it was one thousand, seven hundred and
forty three, so you know expensive. The total number of

(00:57):
homes consented was in decline two and the year to
December twenty twenty three, thirty seven thousand, two hundred and
thirty nine dwellings were concent entered, down from forty nine
and a half thousand the previous year. So the government's
proposed law changes, which will remove the need for building
consents on homes under sixty square meters in certain areas,

(01:21):
so basically your granni flats, and those changes have been
welcomed by housing providers and also the opposition. So this
is all good news, very good news. The coalition government
pitched the changes as a way to make it easier
to build granny flats tiny homes, increase the supply of

(01:42):
affordable housing. All well and good. My only concern when
I heard the news was where are the checks and
balances in terms of the quality of build As Chris
Penk put it, reforms around consenting homes and removing barriers
to overseas building products will only succeed if we have

(02:03):
qualified tradespeople doing the work, standing by it, and being
accountable if things go wrong. We've needed that for many,
many years. When you look at the buck passing around
the leaky homes debargle that devastated the lives of so
many New Zealanders, nobody was willing to take the blame.

(02:26):
And I'm not saying the builders were at fault, but
nobody was. Nobody was held accountable. Ratepayers ended up having
to fork out huge sums of money to try and
remediate the worst disaster for many many couples that they
could possibly have sinking every cent they had and future

(02:48):
funds that they were going to generate, and to a
home that was unlivable. So how do we ensure that
the work done is done right, especially when you hear
tales of undercutting and people coming in and doing a

(03:08):
job for next to nothing because they've got friends and
family and relatives and they're all living together in one
big house. This is the complaints made by your professional
builders who pay the going rate, don't undercut, know what
a job is worth in charge accordingly, how do you

(03:31):
protect consumers from that? For the first and in the
first instance, I'd say, you know, buyer beware, don't just
go for the cheapest price. If something sounds too good
to be true, then it is. But most of us
know very little about structures and engineering and building. I mean,
when you when you go into a home, you expect
that it has been built to last, as many homes

(03:53):
have and in more recent times many homes have not.
How on earth do you check that a building has
been done properly, that in an addition and add on
has been done the unconsented tat that I had to
pick my way through when I was trying to find
a house at the height of the market, was just horrific.

(04:16):
I mean, even though I don't know anything about building,
you know that when something's dangling off the edge of
a cliff held together with a piece of you know,
four x two, chances are it hasn't been consented.

Speaker 1 (04:27):
You know.

Speaker 2 (04:28):
Some of the some of the building inspections, you know,
showed that it hadn't been consented. Things had popped up
on the floor plan out of the blue, and it
all went so far back that there was no ability
to be held account where you just had to buy
it aware that there were you could be buying into

(04:51):
a whole load of problems. And these were houses that
were going for millions in Auckland. So the government says
that it's going to crack down on dodgy builders that,
as Chris says, all of these improvements will only work,
will only benefit consumers ultimately if the building is of

(05:15):
a professional quality. So the crackdown looks to lift the
competence and accountability requirements for building professionals, improving consumer protection
measures in the Building Act, and ensuring regulators have the
right powers to hold people to account. It really counts
for nothing. All very well and good to have a
potential fine of fifty thousand for an individual builder and

(05:36):
one hundred and fifty thousand for businesses to deter bad behavior.
Since when has it you know some of these shonky
builders that people employ, they haven't got fifty k. There's
no way you can whistle for your fifty K one
hundred and fifty thousand for businesses to deter bad behavior.

(05:58):
Can I show you the DEVL group who have lost
hundreds of millions and are now applying for legal aid.
You're not going to get one hundred and fifty G
out of them. So all well and good, absolutely well
and good to lift the accountability requirements and the competency

(06:18):
of building professionals, But ultimately we're all still going to
be left just hoping and trusting that we've employed the
right guys or girls. I've been very, very lucky with
the Reno's. I've done amazing builders, but then they weren't
the cheapest. They had integrity, they were jolly good at

(06:41):
what they did. I presume they still are. The work lasted.
They had absolute confidence. I had absolute confidence in them.
That's what we need is that the norm or are
there too many cowboys getting away with it. I'd really

(07:02):
love to hear from the industry on this, because only
you will know a if these reforms are going to
improve things, and b whether these fines, this move to
improve accountability and professionalism is going to actually work. I
cannot see fines working in any way, shape or form.

(07:24):
The only way I can see this working is by
having a barrier to entry into the profession. You know,
having people who know what they're doing, who are proud
of what they do, who stand by what they do.
There are plenty of those in the building profession. We
just need more of them.

Speaker 1 (07:45):
For more from carry Wood and Mornings, listen live to
News Talks A B from nine am weekdays, or follow
the podcast on iHeartRadio.