Wednesday, October 26, 2011

Earthquake Strengthening

In the last year Earthquake Strengthening has become a big issue for landlords and tenants alike. Many landlords in Multi-unit residential properties are having to get the building assessed by an engineer and hopefully removed from the "Potentially Earthquake Prone Building" list without too much cost involved. Other landlords may be faced with costly strengthening work which may result in large periods of vacant properties, the building may get stickered which would put off potential tenants or as a worse case scenario insurance companies may refuse to ensure the building.

We are dealing with several owners where the Body Corp Committee or chairperson was left in charge of dealing with getting the building assessed. In all but one case the Body Corp has dropped the ball and are totally unaware of the implications of not getting the process up and running as soon as possible. These building are all due to be stickered during peak letting season and I will hate to think what impact this will have on rents and vacancy levels. We believe in being open with tenants about the building they will be living and will be discussing with them the status of the building. Unfortunately there is a lot of fear out there when it comes to Earthquakes. Just because a building is stickered does not mean it it will fall over in an Earthquake. Getting a tenant to understand this is another matter.

Buildings that are currently on the "Potentially Earthquake Prone Building" List are typically buildings that are over 2 storeys high are commercial or multi-residential and were built prior to 1976. Your building could still at risk if it is a single unit dwelling or a house that has been split into several units. The Council will be moving on to creating a list for residential dwellings in the next phase of their Earthquake Prone Building Policy.

So as an owner of an investment property how can you mitigate your risk? As a designer in a previous life I came across many people who renovated their homes. They replaced old scrim walls with plaster board, made small alterations and additions and removed wall in the home with out getting building consent. (After all the walls weren't load bearing) On properties where I was asked to design and prepare consent documentation I always found it difficult to comply with the current building code in regards to earthquake and wind bracing with out relining several walls. If you are considering any work to your property, especially if you are relining or painting walls, take the opportunity to upgrade the bracing of the building and bring it up to current code. You may find that it is cheaper to install the required bracing now then do it down the track when the council requires it to be done.

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