Australia’s construction crisis will cost $6.2 billion in remediation and associated costs, according to new research.
Equity Economics, commissioned by the CFMEU, has released its report, Shaky Foundations: The National Construction Crisis, which analysed the additional costs to owners of remediating water leaks, fire safety breaches, structural failure, combustible cladding and associated costs in apartment buildings built within the last ten years.
It found that more than 3400 apartment buildings around Australia had defective, non-compliant combustible cladding installed, which would require remediation work.
Depending on the type of defect, remediation costs could be up to $165,000 per dwelling, with cladding and water damage works costing around $45,000 per dwelling.
The majority of the defective buildings were found to be located in Queensland, New South Wales and Victoria, with taller buildings often having higher associated costs.
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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,” Noonan 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 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.