Apartment Cladding

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NSW Minister for Better Regulation Kevin Anderson has today announced a major milestone for Project Remediate with the release of an independent report outlining four safe and non-flammable product categories that represent the first tranche to replace high-risk cladding.

Mr Anderson said the four categories had been recommended by the experts of the Cladding Product Safety Panel as part of Project Remediate, the NSW Government’s billion-dollar program to fast track the removal combustible cladding on 214 high-risk residential buildings.

“Thanks to our panel of experts we’ve now identified four, safe, options that can be specified for use as part of the Government’s replacement program,” Mr Anderson said.

“We are taking the lowest possible risk approach to fire safety. That’s why every component we are recommending in the first tranche will have to meet the highest fire safety standard under the Building Code of Australia. The system includes fixings, brackets, and insulation, and will also need to be completely non-combustible.”

Mr Anderson said the project would also appoint a single façade engineer who will provide guidance and quality assurance of the cladding system design on every building remediated by the Government.

“Homeowners need to be confident their building will be rectified with systems that are safe. That’s why we will also be requiring products and systems in each of the recommended categories to have demonstrated independent fire testing before they can be specified in designs under this program,” Mr Anderson said.

Chair of the Cladding Product Safety Panel Professor, Mark Hoffman said the panel would be giving further consideration to additional products and systems but only after more rigorous independent testing is completed and demonstrated.

“There may be additional systems that can safely include elements with some combustibility. The panel will consider submissions relating to these but to date, we have not been provided with robust data from independent accredited labs which tests both the product and the system,” Mr Hoffman said.

Four system categories are considered acceptable replacement options for Project Remediate, subject to additional design requirements. These categories are:

<ul>
<li>Solid aluminium panels installed with cavity barriers and fire-proof mechanical fixings</li>
	<li>Solid metal sheets installed with cavity barriers and fire-proof mechanical fixings</li>
	<li>Fibre cement panels installed with cavity barriers and fire-proof mechanical fixings</li>
	<li>Non-combustible cement render.</li>
</ul>
“It is time to get the job done. We expect to commence assessment and project design for the first batch of 30 buildings by July this year, with the first cladding removed in late 2021,” Mr Anderson concluded.
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Thanks to our panel of experts we’ve now identified four, safe, options that can be specified for use as part of the Government’s replacement program

jordan_55689

Report outlines 4 safe non-flammable cladding products

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EXPERT INSIGHT

Australia has <a href="https://www.tandfonline.com/doi/full/10.1080/19491247.2021.1893119">more than 3,400</a> buildings with flammable cladding. In Victoria alone, at least 71 of these buildings <a href="https://theurbandeveloper.com/articles/cladding-safety-victoria-ceo-appointed">have been classified</a> as “extreme risk” and another 368 as “high risk”. Despite the <a href="https://www.theguardian.com/uk-news/2020/oct/26/director-at-grenfell-tower-tmo-describes-how-fatal-cladding-saved-800000">tragic evidence</a> of the <a href="https://theconversation.com/lacrosse-fire-ruling-sends-shudders-through-building-industry-consultants-and-governments-112777">risks</a> of <a href="https://theconversation.com/cladding-fire-risks-have-been-known-for-years-lives-depend-on-acting-now-with-no-more-delays-111186">cladding</a> fires, rectification work had been completed on only <a href="https://www.theage.com.au/national/victoria/secrecy-around-cladding-hit-list-attacked-as-spin-after-signs-reveal-dozens-of-sites-20210219-p573yr">11 of these buildings</a> by February 2021.

The estimated cost of making these buildings safe is <a href="https://theconversation.com/flammable-cladding-costs-could-approach-billions-for-building-owners-if-authorities-dither-118121">in the billions</a>. State governments have provided limited funding to rectify the highest-risk buildings. Occupants of lower-risk buildings have largely been left to fund the work themselves.

We know from previous building industry failures like the leaky homes crisis in <a href="https://www.stuff.co.nz/business/116236850/the-rottenomics-of-the-47-billion-leaky-homes-market-failure">New Zealand</a> and <a href="https://www.cbc.ca/news/canada/british-columbia/bc-leaky-condo-crisis-1.4609418">Canada</a> that the impacts go beyond the repair costs.

In two recently published research papers, we explore the impacts on occupants’ finances and well-being of owning and living in apartments with flammable cladding in Australia. We interviewed 16 owners and investors from Victoria, Queensland, Western Australia and ACT.

[smartcode_project:default project_id=31257]

What costs are owners facing?

The <a href="https://doi.org/10.1080/19491247.2021.1893119">paper</a> published last week looked at the accumulating financial costs beyond the rectification work. Participants revealed these costs include:

<ul>
<li>
	special levies, to cover rectification costs
	</li>
	<li>
	higher owners’ corporation fees
	</li>
	<li>
	rising insurance premiums
	</li>
	<li>
	legal fees
	</li>
	<li>
	fixing other fire safety defects, such as sprinklers
	</li>
	<li>
	possible loss of property value.
	</li>
</ul>
As one occupant said:

“We’ve (owners’ corporation) had to put the levies up and then we’d have rates of special levies for the legal fees and the fire engineer’s report as well […] And we still got the cladding on the building.”

The financial burdens on households have influenced major and minor life decisions. One participant said:

“I really want to retire in two years […] how will I be able to pay for all of this (cladding rectification)? I don’t know […] It might be the case that I then have to actually sell a defective unit.”

How are owners coping?

Our <a href="https://doi.org/10.1080/02673037.2021.1887458">second paper</a> explores the effects on owners’ well-being. They reported frustration, concern and anger. Some in higher-risk buildings feared for their safety. Some said this range of long-term negative emotions was harming their mental health and well-being.

All owners were very disappointed that building industry-related professions and the government could allow this to happen. This was compounded by the realisation that their building warranty was mostly useless in this situation:

“And then you find out that the warranty is worth very little, and you have to then deal with the builder who’s engaged in dishonest practices essentially […] The kind of builder we had, it’s the kind of builder that would very much just disappear his company, and recreate to avoid any liability.”

Some expressed serious concerns for people’s lives because of the financial stresses the crisis had caused:

“There’s one lady who’s even worse off than me. She’s absolutely beside herself. She doesn’t know what’s she’s going to do […S] he’ll probably go insane or kill herself or something. Seriously […] she is so distraught about this all.”

Policy change needed to improve support

Our research clearly shows apartment owners are feeling the impacts of much more than just the direct rectification costs. Support to help people cope with these broader impacts is lacking. A similar lack of wider support was identified in the building defect crises in New Zealand and Canada.

Recent developments include a Victorian <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2021-02-01/victorian-ban-on-combustible-cladding-comes-into-effect/13107218">ban on flammable cladding</a> on all new multi-storey buildings and <a href="https://www.theguardian.com/society/2021/feb/09/ministers-to-increase-financial-support-for-cladding-removal">extra government funding for rectification work</a> in the UK. The Victorian government is <a href="https://www.vic.gov.au/find-out-about-cladding-safety-victorias-program">contributing A$600 million</a> towards the cost of rectifying some higher-risk apartments. In New South Wales, the government is <a href="https://www.nsw.gov.au/customer-service/projects-and-initiatives/project-remediate">providing interest-free loans</a> to help owners in an estimated 225 buildings.

NSW has also begun work on building industry <a href="https://www.nsw.gov.au/building-commissioner/news/a-better-future-a-better-industry">reforms</a> to:

<ul>
<li>
	improve regulations, with new powers, processes and audit practices for the regulator
	</li>
	<li>
	use a system to rate building risk that links past practice, finance and insurance records so consumers are protected from risky projects and practitioners
	</li>
	<li>
	improve procurement methods with major changes to contracting, declared design requirements, and sign-off processes/stages
	</li>
	<li>
	improve building skills and capabilities through professional education, development, responsibilities and certification
	</li>
	<li>
	develop digital systems to modernise and harmonise the industry.
	</li>
</ul>
These are clearly good steps forward. But governments and the building industry need to do more to provide broader support and protection for the affected households. As our research shows, they are suffering financially on a number of fronts and all the while the crisis eats away at their well-being.

Government policy on housing defects has focused on the cost of fixing these defects. The other indirect financial costs, such as increased insurance, and effects on well-being, have been neglected. Future policy must reduce the risks of more crises such as combustible cladding and, if there is a crisis, consider all the financial costs owners bear as well as the need to support their well-being.<img alt="The Conversation" casgev6pv="" ffbm2w6r6="" height="1" kb3entpod="" src="https://counter.theconversation.com/content/157307/count.gif?distributor=republish-lightbox-basic" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important" width="1">

<a href="https://theconversation.com/profiles/trivess-moore-12580">Trivess Moore</a>, Senior Lecturer, School of Property, Construction and Project Management, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a>; <a href="https://theconversation.com/profiles/david-oswald-1218862">David Oswald</a>, Senior Lecturer in Construction, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a>, and <a href="https://theconversation.com/profiles/simon-lockrey-207247">Simon Lockrey</a>, Senior Lecturer in Industrial Design and Research Fellow, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a>

This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/only-a-small-fraction-of-buildings-with-flammable-cladding-have-been-fixed-and-owners-are-feeling-the-strain-157307">original article</a>.
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In Victoria alone, at least 71 buildings with flammable cladding have been classified as “extreme risk” and another 368 as “high risk”

urban.com.au

Only a small fraction of buildings with flammable cladding have been fixed, and owners are feeling the strain

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The builder behind Melbourne’s Lacrosse apartment towers which caught fire in 2014 has agreed to replace the combustible cladding on the tower.
It comes as Melbourne authorities move to undertake an audit of some 1400 buildings.
Up to 1400 Victorian buildings could have potentially dangerous panelling according to the Victorian Cladding Taskforce, chaired by former premier Ted Baillieu and former deputy premier John Thwaites.
It was created in July after the Grenfell fire.
The interim report into the extent of non-compliant cladding across Victoria concluded there had been a culture of non-compliance throughout the building sector that has meant combustible cladding has become a widespread material used on multi-storey buildings.
"This culture has to change," Prof Thwaites said in a statement.
It found that around 1400 non-government buildings most likely have aluminium composite panels with a polyethylene core or expanded polystyrene panels, but need inspecting to confirm the materials are present.
"Cladding is much more complicated and widespread than we first thought," Planning Minister Richard Wynne said.
Wynne said the Victorian Building Authority would have to "lift their game."
He allocated $5 million for a statewide audit, while adding all of the buildings would be safe to occupy.
The aim is to inspect 10 per cent of buildings each calendar year, up from two per cent.
LU Simon Builders have been involved in a legal dispute with unit owners over the damage bill to the Lacrosse building in La Trobe Street in the Docklands.
The fire, sparked off by a discarded cigarette, started a national debate again this year on flammable cladding after the <a href="https://www.urban.com.au/expert-insights/71811-london-apartment-tower-fire-and-possible-issues-in-australia" target="_blank">London Grenfell tower fire</a>. 
“(This is) so that the owners and residents are not inconvenienced any further by the lengthy legal process which is underway at the Victorian Civil and Administrative Tribunal that will decide how the costs are to be divided up between the various parties,” a statement by the builder said which was carried by The Herald Sun.
“As part of the VCAT action LU Simon will in turn seek to recover the cost of the replacement works.”
The company expressed confidence that it could reach an agreement with the owners corporation, apartment owners and the municipal building surveyor soon, which would allow work on the replacement to commence in early 2018.
Fairfax Media reported that the builder LU Simon had made a scathing assessment of architect Elenberg Fraser's role on Melbourne's Lacrosse residential tower, accusing the design firm of failing to meet its contractual requirements over cladding used on the building.
In a 33-page expert witness report prepared for the builder – when fighting damages claims by the building owners in the Victorian Civil and Administrative Tribunal – saw LU Simon argued Elenberg Fraser did not fulfil the terms of its contract because it did not clearly specify a cladding product for the building as required.
Elenberg Fraser disputed Bullen's report, saying it had been written without seeing Elenberg Fraser's own arguments.
"The report has been delivered early in the proceeding and before there has been any production or inspection of the large volume of documentation held by the parties in respect of the design and construction of the Lacrosse building," Elenberg Fraser's solicitor Sarah Metcalfe of Norton Rose Fulbright said.
"The report is based on a number of incorrect assumptions."
Testing found the cladding on the building to be combustible and Melbourne City Council order it to be replaced – at an estimated cost of $16 million or $40,000 per apartment.
Owners had been fighting to make the builder pay for replacement, but the builder had refused earlier.
The works were required to be completed by July 2018.
City of Melbourne Municipal Building Surveyor Steven Baxas welcomed the builder’s decision, and expressed the hope other builders would follow suit if their buildings had similar flammable cladding. 
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jonathanchancellor-7SQnKwU6yx

Builder agrees to replace flammable cladding on Lacrosse tower in Docklands

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A Frankston South apartment block covered in flammable cladding is such a fire risk that a security guard has been posted out the front to prevent any arson attack.
The owners of the <a href="https://www.realestate.com.au/property/unit-5-5-culcairn-dr-frankston-south-vic-3199" target="_blank">flats</a> have been told by the Victorian Building Authority the cladding will have to be removed immediately.
There is an estimated $400,000 cost including fixing cracking, damp, leaking roofs and mould.
The opposition planning spokesman Tim Smith has raised the matter in State Parliament.
The VBA has declined to reveal the locations of buildings, most of which are privately owned, that have flammable cladding for fear of arson attacks.
A cladding audit ordered by Planning Minister Richard Wynne reviewed more than 2000 building and identified 44 private buildings among the “highest risk” of fire.
The cladding issue across Melbourne was sparked by London's deadly Grenfell Tower fire in 2017.
There was a blaze at the Lacrosse building in Melbourne Docklands and earlier this month a fire at Spencer Street’s Becton-built Neo200 apartments.
The Age reported the 33 owners of a block of apartments received an emergency order issued by Frankston City Council.
“We can’t afford this, people are going to lose their homes,” said Craig Fitch, chairman of Summardai Apartments’ Owners Corporation.
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j.ballantyne1990-6AQqhLzZaK

Frankston South apartments caught up in Melbourne's cladding crisis

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The Strata Community Association (Vic) general manager Rob Beck says Melbourne’s Spencer Street fire highlights the urgency for State Government to regulate combustible cladding material.
SCA Victoria is the peak body overseeing Victoria’s $300 billion strata sector.
It supporting more than 80% of all owners corporation management firms and represent more than 650 owners corporation professionals who manage approximately 375,000 lots. 
Beck says the "anywhere, anytime" nature of Melbourne’s defective building problem, highlights the need for stricter construction industry regulation.
“The quick action of fire fighters today brought a potentially deadly situation under control.
"The need for combustible cladding and other defective building materials to be regulated can no longer be denied,” Mr Beck said.
 
 
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Strata boss says apartment aluminum cladding must be regulated

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A fire broke out in the Neo 200 building on Spencer Street at around 5am today.
The fire is believed to have started on the balcony of the 22nd floor, and then spread to the 29th.
Fire crews were first alerted at 5:43am and the incident was upgraded in severity after they thought the building to have combustible cladding.
The ABC reported 15 fire trucks, two ladder-platform trucks and 60 firefighters were used to extinguish the fire, which was brought under control at 6:49am.
The MFB suggested that the 41 storey, 371 residence tower had some cladding similar to the deadly Grenfell Tower in London which killed 72 when it caught ablaze in 2017.
The residents will need to find alternate accomodation after the Melbourne City Council's building surveyor issued an emergency order that states the building cannot be occupied for 48 hours.
A council inspection of the building has found the fire affected "essential safety measures" including the sprinkler system and fire alarms.
A Victorian Government audit after the Grenfell Tower disaster found flammable cladding posed a fire risk on 1,400 buildings around Melbourne.
<img src="https://www.urban.com.au/images/2019/2/4/Neo%20200%202.JPG" alt="">
The Neo200 apartment complex was found to be "fully compliant" with cladding standards in 2017, according to a 2017 tweet from the developer, Becton.
"While most of the building is not clad at all, where any cladding is used it is compliant with VBA [Victorian Building Authority] standards," Neo200 tweeted.
Premier Daniel Andrews said he would wait for an investigation into the fire before making comment on the role flammable cladding played in fuelling the blaze.
"On the issue of Spencer Street, let's get the facts," he told ABC Radio Melbourne.
The Age reported pieces of the building could be seen falling from the building on the corner of Spencer and Little Bourke streets.
 
<img src="https://www.urban.com.au/images/2019/2/4/Neo%20200%203.JPG" alt="">
 
(Source: twitter user @bekahjaynex)
This isn't the first time LU Simon who built the Neo 200 have been involved in a building fire.
The Lacrosse building, another built by them was devastated by fire in 2014.
MFB fire chief Dan Stephens said “My understanding is that the building is cladded with ACM — aluminium composite material, so the sort of cladding that was on the Grenfell Tower.”
Only roughly 150 people did evacuate the building, meaning many residents stayed behind leaving them at serious risk.
MFB Assistant Chief Fire Officer Trent Curtin said "It’s my understanding that occupants have taken some plastic and wrapped it around the smoke alarm so as to stop it from activating in case of cooking or other products of combustion in an apartment."
In 2017 they tweeted about the cladding being compliant with VBA standards.
<a href="https://www.propertyobserver.com.au/images/2019/2/4/Neo%20200%20tweet.JPG" target="_blank">Click</a> to enlarge.
<img src="https://www.urban.com.au/images/2019/2/4/Neo%20200%20tweet.JPG" alt="">
There are currently eight apartments available for rent in the 200 Spencer Street building, with rental prices ranging from $495 per week to $1,039 per week for one and two bedroom apartments.
One parking space is available for rent in the building at $60 per week
There were 13 sales in the building last year with prices ranging from $650,000 for 3406/200 Spencer Street at the peak. 
Down to the cheapest apartment sold last year 1012/200 Spencer Street, which went for $392,500.
The most recent $610,000 sale on the 28th floor had seen the two bedroom previously sell at $560,000 in 2010 and an initial $579,000 sale in 2008.
A tenth floor one bedroom unit sold late last year for $410,000, had sold on completion in 2008 for 283,000, and twice at 350,000 during the interim in 2010 and 2014.
There are currently three apartments currently listed for sale in the Neo 200 building.
1. 39/200 Spencer Street 
2. 4104/200 Spencer Street, Penthouse
3. 1810/200 Spencer Street
<div>Neo200 is 41 storey building with 371 residential apartments, ground floor retail tenancies and entrances to both Spencer and Little Bourke Streets.</div>
Designed by Hayball Architects, the building is distinguished by its yellow podium lights presenting to Spencer and Little Bourke Streets and its distinctive golden curvilinear foyer.
The building’s construction was completed in 2007 by LU Simon builders and was awarded the 2008 Master Builder Association’s – Excellence in Construction Award.
There was a small fire on New Year's Eve in 2015.
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jchancellor-FAypfDUnLy

Fire at Neo200 Spencer Street, Melbourne reignites apartment cladding concerns

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Victorian Planning Minister Richard Wynne will push for a nationwide ban on combustible cladding at the Commonwealth building ministers’ meeting in ­Hobart today.
The consideration comes as the residents of the NEO200 building in Melbourne’s CBD face more than a fortnight of not being able to return to their homes after a cladding fire on Monday.
The Neo200 building in the CBD was evacuated when a discarded cigarette butt caused a cladding fire.
Following the blaze, Melbourne City Council's building surveyor issued an emergency order that said the building could not be occupied for 48 hours, but this was extended on Wednesday with most residents unlikely to be able to return home until February 20.
"Two additional Emergency Orders and a Show Cause Notice were issued by the Municipal Building Surveyor this afternoon to specify that the building should be vacant for up to a further 14 days," the council said.
The Australian reported Wynne was forced to concede that he was yet to appoint a state building inspector, 14 months after pledging to do so as part of a raft of measures aimed at ridding buildings of dangerous flammable cladding.
The cladding — which was responsible for the fatal Grenfell Tower fire in Britain in 2017 — remains in thousands of Victorian buildings.
Mr Wynne said he would call on state, territory and federal governments to support the ban.
“The Andrews Labor government has led the country in taking action against combustible cladding — introducing changes last year to give the Minister for Planning powers to ban the use of aluminium composite cladding on new multi-storey buildings and provide a low-cost financing ­option to help owners remove dangerous combustible cladding from their properties,” Mr Wynne said.
“The Victorian Cladding Taskforce, the Victorian Building Authority and local governments have also worked with building owners and residents to make buildings safe by completing emergency works such as removing cladding around fire exits and installing smoke alarms.”
Opposition planning spokesman Tim Smith said Mr Wynne’s number one priority was to remove the “dangerous, flammable cladding from existing buildings around Victoria”.
“There are 360 buildings in the most concerning category from the Andrews Labor Government’s cladding audit, and yet they still have not guaranteed that every single resident in those buildings has been informed that their home is at risk,” he said.
Designed by Hayball Architects for Becton, the building is distinguished by its yellow podium lights presenting to Spencer and Little Bourke Streets and its distinctive golden curvilinear foyer.
The building’s construction was completed in 2007 by LU Simon builders and was awarded the 2008 Master Builder Association’s – Excellence in Construction Award.
There was a small fire on New Year's Eve in 2015.
 
 
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Still no return possible for residents after Neo200, Spencer Street Melbourne cladding fire

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GUEST OBSERVATION
Australian building owners face a bill that could run into billions of dollars to replace <a href="http://theconversation.com/cladding-fire-risks-have-been-known-for-years-lives-depend-on-acting-now-with-no-more-delays-111186" target="_blank">combustible cladding</a> of the sort that fuelled the <a href="https://www.bbc.com/news/uk-40301289" target="_blank">Greenfell tower fire in the UK</a>, which killed 72 people, as well as fires in Australia and <a href="http://www.mfb.vic.gov.au/media/docs/post_incident_analysis_for_lacrosse_docklands_-_25_11_2014%20-%20final-dd61c4b2-61f6-42ed-9411-803cc23e6acc-0.pdf" target="_blank">overseas</a>. The cost estimate is based on our calculations for Victoria, which has had apartment building cladding fires in <a href="https://theconversation.com/lacrosse-fire-ruling-sends-shudders-through-building-industry-consultants-and-governments-112777" target="_blank">2014</a> and <a href="https://theconversation.com/cladding-fire-risks-have-been-known-for-years-lives-depend-on-acting-now-with-no-more-delays-111186" target="_blank">2019</a>.
Nearly <a href="https://theconversation.com/grenfell-tower-criminal-charges-delayed-but-that-doesnt-mean-there-wont-be-justice-113215" target="_blank">two years on from the Grenfell disaster</a>, there is <a href="https://theconversation.com/cladding-fire-risks-have-been-known-for-years-lives-depend-on-acting-now-with-no-more-delays-111186" target="_blank">ongoing tension</a> between policymakers, the building industry and owners about how to resolve the problem of combustible cladding. And little information is available about the scale of the issue for owners across Australia, particularly those living in apartments.
So what could the costs be? We looked at Victoria as a case study. Our modelling produced cost estimates of between A$250 million and A$1.6 billion. The ultimate figure will depend on the cost-efficiency of any rectification program and the risk level and size of the 629 buildings known to be affected – and many more could yet be identified.
<iframe src="https://www.youtube.com/embed/NStPd-v42mY?wmode=transparent&amp;start=0" frameborder="0" width="440" height="260"></iframe>
Combustible cladding allowed fire to spread rapidly up the Neo200 building in central Melbourne in February 2019. 
How were costs estimated?
The 2018 <a href="https://www.planning.vic.gov.au/building-policy/victorian-cladding-taskforce" target="_blank">Victorian Cladding Taskforce</a> identified 354 low/moderate-risk buildings and 275 high/extreme-risk buildings in a statewide <a href="https://www.urban.com.au/property-observer" target="_blank">cladding audit update</a> last October.
There is little data available on dwelling density for Victorian apartment building stock. <a href="https://data.melbourne.vic.gov.au/clue" target="_blank">Melbourne City Council (MCC) records</a> show residential buildings with ten dwellings or more (medium-to-high-density buildings) have an average of 75 dwellings per building in the built-up municipality. Buildings of this density are known to be <a href="https://www.theage.com.au/politics/victoria/government-to-act-on-cladding-crisis-but-only-for-buildings-it-owns-20190527-p51rpr" target="_blank">receiving notices from the Victorian government to act on cladding</a>.
To model costs we have also used real quotes owners have received to rectify their properties, as well as quotes revealed in media reports. These quotes reveal a range of lower costs for low/moderate-risk buildings and higher costs for high/extreme-risk buildings, usually based on the work for varying levels of rectification.
Firstly, we conservatively applied lower rectification cost data, being A$2,500 per dwelling for low/moderate-risk buildings and A$20,000 per dwelling for high/extreme-risk buildings.
Secondly, we applied higher costs found in quotes and media reports. These are $15,000 per dwelling for low/moderate-risk buildings and A$60,000 per dwelling for high/extreme-risk buildings. These figures are still conservative, based on multiple sighted estimates approaching $100,000 per dwelling.
We have calculated costs for two scenarios for all 629 buildings identified by last October: 
<ol>
<li>an average of 75 dwellings per building as per MCC data</li>
<li>an average of 37 dwellings per building, 50% less than MCC data to account for a higher proportion of lower-density developments affected (<a href="https://www.urban.com.au/property-observer" target="_blank">based on averages in municipalities</a> significantly affected by the crisis such as <a href="https://www.vba.vic.gov.au/cladding" target="_blank">Port Phillip, Stonington and Moreland</a>).</li>
</ol>
So how high could the bill be?
Our estimates show Victorian owners who are known to be affected may conservatively face a rectification bill of A$250-$500 million, if industry and government work with them to cap costs in economies-of-scale solutions. The bill may be as high as A$1.6 billion, if an inefficient approach is used and we have a higher proportion of larger buildings affected.
<a href="https://images.theconversation.com/files/277823/original/file-20190604-69095-1vb6vrk.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/277823/original/file-20190604-69095-1vb6vrk.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Author provided
Cladding audits are ongoing. The number of identified affected properties is likely to rise. At the 2019 <a href="https://www.youtube.com/playlist?list=PLAWpz7v8cdutmOf_GDwtU3Gcs3CLQ5clb" target="_blank">Building Surveyors’ Conference</a>, the Victorian Building Authority appeared to categorise over 1,200 private Victorian buildings as moderately through to extreme risk for combustible cladding.
If this figure is correct, our cost estimates are conservative and will double.
Our estimates do not factor in the apartments yet to be identified or, more broadly, the issues in <a href="https://www.finance.nsw.gov.au/fire-safety-and-external-wall-cladding" target="_blank">other states</a> that have also been identified.
Government and industry shun responsibility
To date, the response of the Victorian government and industry has been to push financial responsibility back onto home owners. A Victorian low-interest loan scheme was launched in October allowing owners to repay amounts over ten years. It has been <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2019-02-16/combustible-cladding-risk-affects-thousands-but-few-fix-options/10804014" target="_blank">reported</a>, however, that no loans had been granted as recently as February.
The Victorian government’s <a href="https://s3-ap-southeast-2.amazonaws.com/budgetfiles201920.budget.vic.gov.au/2019-20+State+Budget+-+Service+Delivery.pdf" target="_blank">May 27 budget papers</a> stated that A$160 million would be spent on the crisis “on public safety grounds”. This including ongoing assessments of private buildings affected by combustible cladding and 15 evaluation projects to manage and improve rectification outcomes.
As yet no funding has been provided to help owners of private dwellings who bought supposedly compliant properties. While <a href="https://www.propertyobserver.com.au/https://www.sro.vic.gov.au/node/6514" target="_blank">billions in revenue is recouped from stamp duty</a>, owners are being told to rectify a problem for which they were not responsible – all at their own cost.
Many owners simply will not be able to pay. Some individual bills sighted are as much as a quarter of the owner’s property value. On top of this, some insurance premiums have quadrupled.
At the vast costs we have estimated, and based on <a href="https://theconversation.com/cladding-fire-risks-have-been-known-for-years-lives-depend-on-acting-now-with-no-more-delays-111186" target="_blank">the chain of events leading to the cladding crisis</a> and the <a href="https://www.smh.com.au/business/consumer-affairs/victims-suffer-as-combustible-cladding-crisis-rages-on-20190402-p519yy" target="_blank">lack of support following</a>, is it reasonable that sole responsibility falls on owners to pay? And will such a move not lead to thousands of <a href="http://theconversation.com/lacrosse-fire-ruling-sends-shudders-through-building-industry-consultants-and-governments-112777" target="_blank">costly actions through the courts</a> as owners try to recoup costs?
Government and industry should provide substantial financial support to owners to help them recover from mass <a href="https://www.smh.com.au/business/fear-over-highrise-tower-fire-risk-in-melbourne-20141203-11zgp7" target="_blank">failures of policy, regulatory policing and industry practice</a>. The UK government has <a href="https://www.smh.com.au/world/europe/britain-to-spend-200-million-fixing-combustible-cladding-20190510-p51m2c" target="_blank">to the tune of £200 million</a> (A$364 million). It is time to support Australian owners in a billion-dollar crisis they were not responsible for creating.
<hr>
Acknowledgments: We would like to thank Phil Dwyer from <a href="http://www.builderscollective.org.au/" target="_blank">Builders Collective of Australia</a> for working with us on the modelling for this article.<img src="https://counter.theconversation.com/content/118121/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Simon Lockrey, Senior Lecturer/ Research Fellow, RMIT University
Trivess Moore, Lecturer, RMIT University
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/flammable-cladding-costs-could-approach-billions-for-building-owners-if-authorities-dither-118121" target="_blank">original article</a>.
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Flammable cladding costs could approach billions for building owners if authorities dither

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Victoria will spend $600 million to deal with the flammable cladding crisis on apartments across the state.
Around 500 buildings need rectification work to be made safe.
The state government are committing to $300 million from existing funds, but they are hoping the other $300 million will come from the Federal government.
Victoria Premier Daniel Andrews has written to Prime Minister Scott Morrison to ask for the funds to fix the issue.
If the Coalition don't match the $300 million that has been requested, funds will be sourced from an increase to the building permit levy over the next five years. 
<div class="block-content">
<div class="styles__Container-sc-1ylecsg-0 goULFa">The new body, Cladding Safety Victoria, will oversee the fund and will be getting to work within the next few weeks on the 15 highest risk buildings.</div>
<div class="styles__Container-sc-1ylecsg-0 goULFa"> </div>
<div class="styles__Container-sc-1ylecsg-0 goULFa">Planning Minister Richard Wynee said it's just as much about safety as it is about fairness for people who bought apartments in good faith and were let down by dodgy builders or dangerous building products.</div>
</div>
The move is among 35 recommendations made to the Victorian Government after 2,227 buildings had been inspected as of July 5.
Of those, 7 per cent were rated as an extreme risk, 40 per cent a high risk and 38 per cent moderate risk.
The data, presented at an industry conference, showed one evacuation order had been issued for a private building.
Emergency orders for urgent works were made on 51 properties with building notices issued on a further 387. 
The 35 recommendations were made by the Victorian Cladding Taskforce, headed up by former Liberal premier Ted Baillieu and former Labor deputy premier John Thwaites.
The ABC reported Daniel Andrews said the state was also examining ways to recover some of the costs from people and business "who had done the wrong thing".
It could include laws to punish dodgy providers and so-called "phoenix companies" that set up for only one project, then shut down and made it hard for people to sue them.
It has also flagged a plan that would see the Government assume the right to sue industry on behalf of residents because class actions had failed.
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Building permit levy to pay for half of Victoria's $600 million combustible cladding rectification

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Australia's building and construction crisis will cost $6.2 billion in remediation and associated costs, according to new research commissioned by the construction union.
The independent research, undertaken by Equity Economics and contained in the report 'Shaky Foundations: The National Construction Crisis', analysed the additional costs to owners of remediating water leaks, fire safety breaches, structural failure and combustible cladding and associated costs, in apartment buildings constructed within the last ten years.
The research also found that over 3,400 apartment buildings across Australia had defective, non-compliant combustible cladding installed, and would require remediation work to make the buildings safe.
CFMEU Construction and general division national secretary Dave Noonan said that the cost of Australia's building and construction crisis was now clear, and unfortunately often homeowners would likely be the ones to foot the majority of the bill.
"Australia's building and construction crisis will cost a staggering $6.2 billion to fix apartments they've already paid for."
"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."
He added that in some cases, the costs of this remediation has been up to $165,000 per dwelling.
Australia's building and construction crisis was brought about by a range of factors the union has been raising concerns over for some time.
"This is the result of the construction industry's obsession with 'deregulation' at any cost, and poor oversight by government," Noonan added.
"It's the result of years of not enforcing building standards and of allowing industry to 'self-approve' with little or no oversight. Often, it has fallen on the union to blow the whistle."
Noonan also said that a national problem required a national solution and that the union was willing to work with government to resolve these important issues for the community.
"We'll be producing detailed policy solutions and will work with the Federal and State governments across Australia over the coming months. Now is the time to come together – not silence dissent," he concluded.
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