An insurance commentator says some homeowners may have to wait for months, or even years, to have their homes properly assessed as almost 2000 scheduled building inspections are cancelled by Auckland Council.
The council confirmed on Wednesday afternoon that hundreds of building inspections booked for Thursday and Friday were cancelled, before cancelling inspections through to February 7 later that afternoon. More than 940 inspections planned for Tuesday and Wednesday had already been cancelled.
Building consents general manager Ian McCormick said in an email the council recognised how disruptive the cancellations would be for the building industry.
"However, it is important that we continue to prioritise the identification of unsafe buildings to safeguard the public and enable the recovery process."
More than 540 properties have been yellow-stickered and 138 red-stickered in the region, and insurer IAG said it had already received more than 13,600 insurance claims.
Finance Minister Grant Robertson called the storm New Zealand’s biggest non-earthquake event in terms of insurance.
Massey University senior lecturer at the School of Economics and Finance, Michael Naylor, said insurance companies can quickly look at whether there is a relevant insurance claim or not, but getting a full building assessment on what needs to be done and how much it might cost to repair takes "a long while".
He said there were cases in Westport, which was subjected to severe flooding in July 2021 and February 2022, where homeowners hadn't had properties "properly" assessed 18 months later.
"The lesson from Christchurch is yes, you can lodge a claim fast, and the insurance company will respond fast. But to actually get a sense on the ground, and to get a proper building estimate, could take two-to-three years."
Auckland Council has been urgently assessing thousands of homes damaged as a result of Auckland’s record-breaking storm.
McCormick said 1350 buildings had been assessed for storm damage by the Council’s building inspectors in two days, and there were still thousands of flood-affected buildings that needed to be inspected.
“Some of the damage we are seeing is heartbreaking, there are hundreds of displaced families due to unsafe or insanitary houses out there."
McCormick said inspectors had been conducting rapid building assessments across Auckland, and there was only a small team of inspectors available for "urgent or essential" work.
The council said people who have had inspections cancelled would need to rebook.
Flood of demand
Retailers are already seeing an uptick in demand from Aucklanders trying to clean up.
Chris Peak, Mitre 10's chief merchandise officer, said Aucklanders were looking for things like submersible pumps, wet vacs, flood dams, and drain coil before demand shifted to mops, cleaning products and dehumidifiers.
“We expect building materials like plasterboard and plywood will also see increases as people move to repairing their homes and businesses.”
Derek Powell, head of operations at Bunnings, said its Glenfield store was closed, but at its other Auckland outlets flexi-bins and garden waste bags, dehumidifiers, wet and dry vacuums, submersible pumps and generators were sought after following the flooding.
Both retailers said they were working with suppliers to make sure they had what Aucklanders needed in stock.
High demand in the construction sector isn’t good news for inflation, Westpac senior economist Satish Ranchhod said.
He said construction inflation had been running at 17% annually, and with a pipeline full of projects, inflation pressure would remain.
Construction experts are also warning projects in the region will be delayed by months as civil contractors work to clear slips and flatten land to prevent further damage.
Auckland University of Technology profession of construction management, John Tookey, said delays were inevitable but how long the delays would be depended on further flooding and damage from more bad weather.
57 Comments
Thanking Jesus I'm not 80% through a development with everything getting tight....
MAX UGLINESS
Pressure from all angles.
Potential buyers of new builds will just have to focus on existing.
Your fave economist reported a week ago that investors are planning to buy.... existing. He surmised as there is less uncertainty and its deal time
Its an act of god
NOT A SIGN from god to BUY
I have images of , take off your shoe, everyone take off one shoe..... but property is close to a religion here.
The council confirmed on Wednesday afternoon that hundreds of building inspections booked for Thursday and Friday were now cancelled. More than 940 inspections planned for Tuesday and Wednesday had already been cancelled.
Why have they been cancelled ??? The Council scheduled them, the weather is better, WHY HAVE THE INSPECTIONS BEEN CANCELLED ?
I reckon those staff have been moved to inspecting the 5000 odd houses that have damage to do the yellow/red sticker thing.
Maybe? But then the Council should say so, you do not allocate hundreds of jobs and then cancel them, without giving a reason, and I would suggest a pretty darn good one!
It's in the article
"However, it is important that we continue to prioritise the identification of unsafe buildings to safeguard the public and enable the recovery process."
Council inspectors are in triage mode and inspecting a new ensuite is right down the pecking order.
‘It’s in the article’
lol
Given the experience we've had in CHCH, surely someone in government can coordinate a workflow methodology with insurers that streamlines the assess and repair process. I have ideas of how I'd do it if in government, so surely they have people who can think outside the square. Years of delay are just unacceptable. Much of the work that will need to be done post-flooding is far more routine/common and easier to assess and repair than the kind of complicated structural work needed after the EQ.
The only thing that will slow down this recovery is bureaucracy.
I have IT friends that made a mint from the EQC work, but they say it was super dysfunctional. The bureaucracy knew next to nothing about building damage accessment or IT systems, so they got what they paid for.
The CHCH home owners I know who got good quick payouts managed to get included in class actions from lawyers while said layers had space to represent them.... those who went legal late missed out.
I lost my house in the Chch EQ, if you want a reasonably quick payout, about 18 months, you have to be at it constantly, and by that I mean every day, but few people are prepared to do this. People who just wait didn't get paid out for 10 years... I also hired an american company specialising in these types of events, they weren't very helpful.
I also need to shout the Dodds family a very nice dinner with top wine!
Government ministries are full of policy generalists who usually know very little about the subject matter they are employed in. Go figure.
I have been told several times it doesn’t matter, because it’s the policy analysis skills that are what’s critical.
I am not making this up….
Lets get the minister for Auckland on the job
Michael Woods should be only in charge of handing out the brylcream
"The only thing that will slow down this recovery is bureaucracy."
But...that's exactly the Central/Local "Public Service" raison d'etre. Ensuring their own jobsworths no matter how badly they serve their customers. A taxpayers/ratepayers funded monopoly with no legal competition permitted.
I'm touched by your faith - it must be faith because there is no evidence for their service improving over the years - quite the contrary.
As an eg:
Here is the timeline of the not at all panicked and confused Government on schools and ECEs in Auckland.
- Schools may close if necessary
- All schools and ECEs must close for a week
- ECEs don’t need to close if parents need to send kids to them
- Schools now told they may be able to open this week
- Schools told they can open on Thursday
https://www.kiwiblog.co.nz/2023/02/the_governments_many_stance_on_auckl…
Yeah the Labour lefties realise just how thick most of their supporters are so tries to direct them from WGTN.
The Right overestimates how smart most supporters are, so allows them to make their own calls from WGTN.
Hilarity occurs whoever is in Government.
It was simpler in the 80s when Darwin was allowed to take care of the idiots.
Even the lefty schools are in disbelief.
Epic debacle.
Given the experience we've had in CHCH, surely someone in government can coordinate a workflow methodology with insurers that streamlines the assess and repair process.
This would be more possible if 90%+ of the houses in NZ weren't designed and built bespoke over a period of over 100+ years.
The problem is the assessments on these will also likely require invasive inspections to determine the extent of water damage inside walls to framing, electrical, etc.
And there's just not enough competent assessor's to handle such a massive sudden uptick in demand. It's potentially hundreds of thousands of hours of inspections.
You have to first get insurers on side - as you've got to bypass the assessors and go straight to LBPs doing the assessment and providing the quote. And put together 100s of specialist teams; chippies, plasters, painters and electricians, on fixed-term contracts to avoid the delays associated with waiting for subcontractors. Turn the exercise into a factory-style production exercise.
LBPs aren't assessor's though, that's not their core business or competency. They're capable of assessing and pricing building work, but any other trade is outside of their wheelhouse, so they would have to go to market and get subtrades to also price their component, collate and present everything in a format insurance companies like. It'd be more cumbersome/expensive than using assessor's.
Then you're requiring the tradespeople to commit to short term contracts on wages whilst competing with the rest of the market that is going to generally pay more and offer better conditions.
Unfortunately the nature of remedial work is it lacks any scope for factory style efficiency. At best insurers will devise standard metre rates for the work and nominate subcontractors to handle all their work.
Source: several decades in and around the industry.
The insurance industry is the problem. Was in CHCH - will be in this one too.
Not that I'm a fan of insurance companies, but any organisation has only so much capacity and it's no easy feat going from a handful of claims in regular times to a large scale event like this in a short period of time.
Totally incorrect - working in the insurance industry through this time the issue was that EQC was set up to require people to talk to them for any claims - They were not able to handle the volumes of calls and this caused massive issues in claim processing.
Post the quake, the insurance companies proposed to the govt that in all instances of any similar events, the process would be to lodge all claims through the insurance companies, and then they would deal with any govt agencies as needed. Insurance companies have dedicated call center staff wo can deal with the process much more effictently.
Yes, appreciate EQC was part of the insurance problem in CHCH.
But, if processes have improved so much, then why is the Insurance Council claiming;
Insurers are warning it will be years before all claims are settled for flood damaged homes, cars and contents in Auckland.
The Insurance Council says so far 15,000 claims have been lodged.
Its consumer affairs manager Sarah Knox says the recent flooding is unprecedented and processing insurance claims will take years.
Knox says for a standard flood, it would take a year to process most claims.
But, if processes have improved so much, then why is the Insurance Council claiming;
Because that's how long it'll take to get through that much work?
Only because they have not modernised/upgraded their processes. The insurance industry has done a tremendous amount of work on assessing the impacts of climate change - so this type of widespread insurance event will have come as no surprise to them. If as a business you know that your capacity to cope in a major event is limited, then you re-design your processes to get through it more quickly.
For example, why can't assessments be done via video link with the homeowner/insured? Technology is a wonderful thing.
You'd save on travel time and lose on innacuracy. Lotta things need someone who knows what they're doing physically present to inspect them.
Adaptation is the name of the game; everyone - both people and businesses - are going to have to change the way they do things.
That's a common view, understandable as we have some amazing technology, but it is very incomplete, elements of it still decades away.
In the meantime, actual humans still need to be physically present to do a raft of functions, the digital alternative still vastly inferior.
As an interesting aside, the introduction of computers on construction sites has had mixed benefits. Because everyone now has instant communication devices, company management now want real time comms with foremen and supervisors, so there's now 2-3hrs+ a day per person wasted on comms instead of churning out actual work. Did technology make it more efficient, or have labour costs jumped 30%.
If that was the case Auckland council could save millions by not doing the inspections themselves and we would still then end up with the cf of faulty, dangerous and illegal building practices as we did when they thought they could outsource some of it. In retrospect there is a reason building inspections for new builds are in person by those who take years of training and experience in NZ building industry and a reason why for old buildings (with often missing building plans because the document storage site burned down like in West Auckland or unconsented works somewhere in the past few decades and no clear sight lines to structural quality) will cause a longer time to inspect. You think they just whip around with a camera and leave lol there is a lot more engineering issues to inspect in flooded property than what the appearance of the gib and floor looks like. It is almost a facepalm moment you suggested that at all. You also cannot just get 200 more inspectors by waving a magic wand and have them travel through flooded streets and even areas with land slips blocking roads... or perhaps you do think that, who knows.
A more recent article suggests they are already using virtual assessments;
“The assessment process will include virtual assessments (where damage is light, and we can use photos) and face to face assessments when the damage is greater.”
That's my point.
"will include " *not entirely made up of and to be taken and evaluated by trained skilled professionals in building assessments
"where damage is light" *only in cases where it is already identified not much flooding occurred around the property at all, (including the surroundinng grounds and neighbouring areas in the case of geotechnical and structural damage
Protip it pays to read and understand what you are reading. Even roofing leaks may still need trained assessors with measuring equipment to assess for structural damage. Properties with no flooding can be red stickered or need assessments from geotechnical experts with neighbouring sites at risk from slippage. Engineers taking photos often require several degrees and added training and experience to know what they need to take photos of and what to look for. Because it is not an instagram account you are managing but an actual physical world with real world consequences when something fails.
It starts with EQC getting an engineer's report, plus the insurance company getting their own report, plus the owner getting their report.
All at $15 grand each.
10 years later …like the Church earthquake.
Many of the insurance repair jobs are going to have quality problems down the track because no one gives a damn these days.
The budgets, timeframes and conditions are terrible. Insurance work attracts the best of the rest.
Can we keep fletchers away from adding their cost-gouge "oversight" layer this time?
They squeezed margins hugely in ChCh and caused a lot of the long term issues.
Sadly once you get to this sort of work the budget is weighted towards the ticket clippers and record keepers and not the actual work to be conducted.
Officialdom wants everything certified and ratified so that's what gets priority.
Why do councils get involved with "stickering" houses - private residence so sort it out with your insurers or builders/engineers
And if the persist do they actually have the required experience to do the job properly or just more of a headache for the home owner to deal with
I can understand why they would do this for buildings that the public have access to but having been in the situation as a home owner I would have been better off if they had left us alone to sort our own issues out
having been in the situation as a home owner I would have been better off if they had left us alone to sort our own issues out
Exactly. Surely people can self-assess whether they are red stickered (unable to occupy) or yellow stickered (only able to occupy certain parts of the home). I assume the only reason it has to be done by council inspectors is so you have proof for your insurance company that temporary accommodation costs will be covered. It's just a silly bureaucratic requirement.
Goodness me, if they doubt you as the policy holder, then they give you a video call - you show them the damage and problem solved.
Yeah because everyone picks up a structural and geotechincal engineering degree from their box of cereal where you obviously got yours.
Also protip a lot of properties that even regularly have flooding and even sewage flooding that are still habitable after cleaning and minor repairs as they go. There is a huge gulf in what you see and what an inspector actually does. I would recommend you investigate and learn about that gulf. It could save you from physical harm and financial costs in life. Many properties that are red stickered are because of significant structural & geotechnical issues as well as sanitation/drainage damage issues (e.g. severe damage to what you cannot see by looking at gib and carpet damage). Try going and looking at your foundations for a really long time and try thinking what might go into the design & earthworks to ensure they can hold up their own weight as well as that of the building and the contents within. Then try calculating the forces involved when part of it is affected by floodwaters. Some red stickered homes had the entire concrete foundation crack in several places, move and also have large sink holes open up beneath them... A homeowner that cannot even get under to look in a situation that would have worksafe and ACC screaming is not going to understand that while no water came into the house it is now so unsafe they cannot live there because the land and the building cannot hold its own weight and can collapse in sections with further minor ground movement.
But then I may be cruel in assuming you were not being sarcastic and cruel to flooded homeowners when you suggested they could take photos on what they could see and "self assess". Because if your suggestion was genuine it would be the worst idea since recommending people could stop highway traffic by jumping in front of a fast moving truck at night.
See above, they are already using virtual assessment.
Wow - the resistance to lowing the level of bureaucracy with respect to processing of insurance claims is strong here.
Engineers taking photos often require several degrees and added training and experience to know what they need to take photos of and what to look for. Because it is not an instagram account you are managing but an actual physical world with real world consequences when something fails. It is physically dangerous to people and can kill if not done right.
I wonder if every house that had flood damage will get a note put onto their LIM?
Given a lot of places that flooded where already marked as a flood risk zone by the council they probably already do. In many councils there are levels of flood risk applied with the highest being those by streams, creeks and waterways (most the suburbs that flooded had poor maintenance around these and already were marked with high risk of flooding). The downside is in a rental crunch or housing crunch there are few options for people to actually avoid high risk and even low risk flooding zones. Most rentals will not disclose prior flooding and have no requirement to, house sales even for leaking buildings are still going through and swapping the prior building with one that still suffers the same poor conditions causing seepage or leaks into the property will be seen as an easy way to get around bad rap. Sadly streets in Ranui were so bad you could see the ground drainage issues and flood risk & occurrences with damaged foundations, and structural elements even without full testing years ago... a ballpoint pen or finger could go right through some and that would leave you running away.
Likewise places on the shore and out south had also been flooding for years before, the residents were begging councils to clean, clear and fix the drainage issues and all the council did was consent more infill housing... bit of a sore point in the poor areas of the west and the shore (they don't even get decent rapid PT to make up for it like out South). I have seen whole hillsides of trees knocked down in those areas for intense development or cases where 1 house on a small parcel of land with barely any garden being replaced by 8 townhouses with no parking to speak of all consented under new "green and climate friendly" rules. Fun fact you could see this was coming way ahead. It was so bad and yet all the complaints to the council of this were thrown into the must be nimby/boomer box. Lol those suburbs out west there was a pothole 4mx3m with the chunks of the road ripped up blocking the drains and AT still did not fix for years... could not get my disabled partner into a house there to view. 12 months of weekly complaints and checkins with AT and the council nothing, area flooded, still nothing. I lived in all those areas which flooded as well as inspected many houses there. In some properties in streets further down it was so bad they flooded every time it rained due to poor overland drainage paths (also the areas are clay heavy) and shocking council infrastructure (even though some of these properties were high on a hill). You don't just need a huge outlay in overland drainage landscaping, drainage channels, pump and storage tankers to remove the water regularly for some properties, but also a decent UPS setup or generator because often when it is a storm the power going out is common. You cannot trust the council or AT to manage storm water around properties on public land, more often they will add more storm water issues to a neighbourhood now.
I feel sorry for the people that did not get to leave those properties early enough and were still there. Those who were still fighting for the neighbourhood with the council and AT. Neighbours and community there were poor but the areas went through a massive property boom in house values. Hence why so many were uninsured, and many were beneficiaries who would never ever be given the chance or opportunity to be insured so they are always in survival mode moving from one traumatic event to the next, starting from scratch each time every couple of years.
I'm not sure you can equate delays in Westport with what will happen in our largest city given the relative size of the markets, can you?
Here they go with their don't expect these claims to be solved quickly;
Insurers are warning it will be years before all claims are settled for flood damaged homes, cars and contents in Auckland.
The Insurance Council says so far 15,000 claims have been lodged.
Its consumer affairs manager Sarah Knox says the recent flooding is unprecedented and processing insurance claims will take years.
Knox says for a standard flood, it would take a year to process most claims.
To process? I assume that means to get the paperwork done before we'll even get round to reimbursement.
I think the government needs to step in early and make them up their game.
If you dont pay your policy invoice within 30 days they can/will cancel
should be same rules for payout - if not settled within a prompt timeframe - say 90 days then interest or regulated fees get added
Great point - easy to implement via regulation.
Here is a clue there is significant structural assessments that go in to even assess whether a house is liveable or not, even if no flooding actually occurred in the property. Checking for damage or key risks to enable a property to be safe for habitation take time and testing. Checking tens of thousands of houses and land and neighbouring risks with a limited number of trained assessors take time. Even years before this you could be waiting weeks for full assessment; which includes testing with specialized equipment on storm damage or slippage, as measuring and evaluating property, buildings and land and giving an estimate on whether they can be repaired or mitigated and the costs associated takes time. This takes normal time for the work to be done. Each case report is NOT a magically appearing document instantaneously appearing, multiplied by the thousands. It is NOT an instagram account anybody with no clue what to look for can do. It is physically dangerous to people and can kill if not done right.
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