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Leaky Home Scheme

By Andrew Steele - 11 Nov 2010

A scheme to help owners of leaky homes has been proposed by Government.  The scheme is expected to come into force early in 2011.

While the precise terms are not yet known, indications so far are that:
• the Government will meet 25% of the agreed repair costs
• the relevant local council will meet 25%
• the homeowners will meet the remaining 50%.
If the homeowner meets bank lending criteria the Government will guarantee a bank loan to fund the homeowner's 50% share.

In exchange, homeowners will lose the right to sue their local council or the Crown, but will still be able to sue other liable parties, such as builders or architects.

Who is eligible for the scheme?

To qualify, applicants must meet all the criteria required to lodge a claim in the Weathertight Homes Tribunal. The defective works must have been completed within the last 10 years.

Homeowners may choose to participate in the scheme when it becomes available even if they have already begun claims under the current process.

Four councils have so far indicated their support for the scheme:  Auckland Super City, Tauranga, Wellington and Christchurch. About 90% of leaky buildings currently subject to claims are within these councils' boundaries.

The Government estimates that approximately 23,500 homes are eligible for the scheme and around two thirds of them will use the scheme, costing around $6.3 billion.

If you would like more information please contact Andrew Steele.


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