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Monolithic Homes And Hidden Rot · That Home Loan Hub

• 0:10
  SPEAKER_00: Monolithic type cleaning.
• 0:12
  SPEAKER_00: We often ask what it is, what are the dangers of it, and whether the banks would lend against them or not.
• 0:18
  SPEAKER_00: Yes, I know.
• 0:19
  SPEAKER_00: And today I have our building inspector expert, Evan Cardwell, who's looking at me and laughing.
• 0:28
  SPEAKER_00: Because we had a bit of an off-chat that I haven't had enough coffee this morning.
• 0:31
  SPEAKER_00: Hello, Evan.
• 0:32
  SPEAKER_01: Hi.
• 0:33
  SPEAKER_00: Good to have you back.
• 0:34
  SPEAKER_01: Yeah, great to be back.
• 0:35
  SPEAKER_00: You've been missing an action.
• 0:37
  SPEAKER_01: I have.
• 0:38
  SPEAKER_01: I we have a new addition to our family.
• 0:40
  SPEAKER_01: So we've got a month-old baby at home.
• 0:43
  SPEAKER_01: So I am feeling the sleep deprivation.
• 0:46
  SPEAKER_01: Yep.
• 0:47
  SPEAKER_01: Like you.
• 0:48
  SPEAKER_01: Although my wife would beg to differ because I got a full night's sleep last night.
• 0:51
  SPEAKER_00: So lucky you.
• 0:52
  SPEAKER_00: Yeah.
• 0:52
  SPEAKER_00: Like you.
• 0:53
  SPEAKER_00: Well, congratulations on the baby.
• 0:54
  SPEAKER_00: It's always exciting to have one.
• 0:56
  SPEAKER_00: And um, you've got two, and you know, you can catch up to me soon.
• 1:01
  SPEAKER_01: Oh, yeah.
• 1:02
  SPEAKER_00: I hope wife is not listening to this episode.
• 1:04
  SPEAKER_01: Uh I don't think she's listened to any of them.
• 1:07
  SPEAKER_00: Shocking.
• 1:07
  SPEAKER_01: Shocking.
• 1:08
  SPEAKER_01: And she's a she's a podcaster as well.
• 1:10
  SPEAKER_01: So not she doesn't produce her own podcast, she just listens to a lot of podcasts.
• 1:14
  SPEAKER_00: Okay.
• 1:14
  SPEAKER_01: Yeah.
• 1:14
  SPEAKER_00: All right, we'll make her.
• 1:15
  SPEAKER_01: Yeah, she already hears enough building chat at home.
• 1:17
  SPEAKER_01: She doesn't need to hear more.
• 1:19
  SPEAKER_00: No.
• 1:19
  SPEAKER_00: So, Evan, monolithic properties.
• 1:21
  SPEAKER_00: What do we do with them?
• 1:23
  SPEAKER_01: Oh, it depends on the condition, but maybe bowl them down.
• 1:27
  SPEAKER_01: I don't know.
• 1:28
  SPEAKER_01: No, I mean give me a story.
• 1:30
  SPEAKER_01: Yeah, so I didn't inspect this one myself.
• 1:33
  SPEAKER_01: One of my colleagues, Karen from the Wellington Check Home.
• 1:37
  SPEAKER_01: He did an inspection on a monolithic.
• 1:40
  SPEAKER_01: And so there was a disclosure about some swelling to skirting boards on the interior.
• 1:49
  SPEAKER_01: He was getting elevated moisture to the exterior cladding.
• 1:54
  SPEAKER_01: And when he went inside the vendors had taken off some of the skirting and the plaster board, the jib had fully deteriorated down the bottom of the uh the bottom of the wall, and then you could actually just pack away some of the timber bottom plate.
• 2:17
  SPEAKER_00: Like with bicks.
• 2:19
  SPEAKER_01: Worse.
• 2:20
  SPEAKER_01: Yeah, it was it was bad, very rotten, and that was just a small section, probably like I don't know, maybe two, three hundred mil wide visible.
• 2:30
  SPEAKER_01: So that's definitely going to need a building surveyor to go in.
• 2:35
  SPEAKER_01: Cladding's gonna have to come off, they're gonna have to assess the damage.
• 2:39
  SPEAKER_01: See it quite a lot, uh, especially online.
• 2:42
  SPEAKER_01: Different building companies put videos out where they'll remove cladding and then the building surveyor will go through, spray paint all the affected timber, and essentially say what needs to be replaced and what's fine, and then the full reclad or you know, partial reclad, yeah, stuff like that.
• 3:04
  SPEAKER_00: And that's costly.
• 3:06
  SPEAKER_01: Very, very easily, you know, from 200,000 all the way up to potentially a million, depending on the style of house.
• 3:15
  SPEAKER_01: Yeah, or more.
• 3:16
  SPEAKER_00: Because a lot of those monolithic properties tend to be two-story as well.
• 3:21
  SPEAKER_01: Yep, two-story with internal deck over usually like a lounge or a bedroom downstairs, class fascia, gutters, poor cladding clearances, raking or curved windows with no kick out flashing.
• 3:38
  SPEAKER_01: So there's there's all these different risk areas involved in monolithics, which is you know, you the the hard part is, and I and I did a building inspection uh just recently where the house I think it was a 2000 or 2001 build, and it had class fascia, and a portion of it was monolithic.
• 4:03
  SPEAKER_01: It was actually in really good condition.
• 4:06
  SPEAKER_01: There was definitely risk areas, and highlighting those risk areas was really important writing the report, but I was getting no elevated moisture to any of the exterior cladding, none on the interior, but it's still unknown what the condition of the wall, the the framing is like, purely because moisture could suck through it, it was direct fix, so no cavity system, so moisture could be coming through and it could be hiding damage.
• 4:35
  SPEAKER_00: So, was this one that your colleague has done?
• 4:38
  SPEAKER_00: It was commissioned by the Vendors?
• 4:41
  SPEAKER_01: I think so.
• 4:42
  SPEAKER_00: It wasn't just people that just bought it and now they're like freaking out.
• 4:46
  SPEAKER_01: I would I would have to double check on that.
• 4:48
  SPEAKER_01: It might have been a pre-purchase.
• 4:51
  SPEAKER_01: I don't know, I didn't ask.
• 4:52
  SPEAKER_01: We just saw the saw the video of the damage, and yeah, he just put his finger through the bottom plate, which and fixated on that.
• 5:01
  SPEAKER_01: Yeah.
• 5:01
  SPEAKER_00: Jeepers.
• 5:02
  SPEAKER_00: I did have clients.
• 5:03
  SPEAKER_00: I did have clients in Wellington that bought a house.
• 5:06
  SPEAKER_00: They've used a different broker, not me, just clarifying.
• 5:09
  SPEAKER_00: And because normally I would say to my clients, stay away from those sort of properties.
• 5:14
  SPEAKER_00: They ended up buying that house, and then they came to me a few years later going, Hey, we need to do RickLed.
• 5:19
  SPEAKER_00: Uh initially, they got it quoted for like 200k.
• 5:23
  SPEAKER_00: As the progress started, as the house got opened up, and that's the danger of it, right?
• 5:29
  SPEAKER_00: Until you open up the cladding and you see what's inside and the state of those frames, you just don't know what to expect.
• 5:35
  SPEAKER_00: So from 200k Rick led, we went to up to 450.
• 5:39
  SPEAKER_01: Yeah, that's not surprising.
• 5:40
  SPEAKER_00: It escalated really fast for them.
• 5:42
  SPEAKER_00: The lucky thing for them was they actually had quite a lot of equity in that house.
• 5:47
  SPEAKER_00: So that was a saving race, and they both had really good incomes.
• 5:51
  SPEAKER_00: But if neither of those was present, we would have really struggled to get them any lending done.
• 5:58
  SPEAKER_01: Yeah.
• 5:58
  SPEAKER_00: Because if you're negative equity, the bank is not going to give you money.
• 6:02
  SPEAKER_00: So then what do you do?
• 6:03
  SPEAKER_00: You get stuck.
• 6:04
  SPEAKER_01: Well, you get builders' report.
• 6:06
  SPEAKER_00: Yeah, builders' report up front.
• 6:07
  SPEAKER_00: Well, that would be a good idea.
• 6:09
  SPEAKER_00: But yeah, it's amazing.
• 6:10
  SPEAKER_00: So let's just be clear.
• 6:11
  SPEAKER_00: This is usually for properties between the 1990s to 2004, I think.
• 6:16
  SPEAKER_00: Correct.
• 6:16
  SPEAKER_00: That's when they were building them without cavity systems installed.
• 6:20
  SPEAKER_00: Do you know much about the history of it?
• 6:22
  SPEAKER_00: Like, how did it start in New Zealand?
• 6:25
  SPEAKER_00: Why did they start building those houses?
• 6:30
  SPEAKER_00: Putting you on the spot here.
• 6:31
  SPEAKER_01: Yeah, I mean it it's it's a design.
• 6:35
  SPEAKER_01: It's just the designed look, and what works in other areas in the world doesn't necessarily work here.
• 6:43
  SPEAKER_01: So stucco clad houses they work great for, you know, you know, you see them in Italy and and France and and whatnot.
• 6:52
  SPEAKER_01: The climate's just different there.
• 6:54
  SPEAKER_01: You bring that same style of cladding, and stucco has been around for hundreds of years, just the way that it's been built, you bring it here with a direct fix cladding system, it just draws the moisture through because our climate is so volatile and it's just going to get worse.
• 7:14
  SPEAKER_00: Yeah, yeah, exactly.
• 7:16
  SPEAKER_00: So um the warning to the buyers out there if you're looking to buy a monolithic type cladding, and look, I have lots of builders that want to buy those sort of properties because you can get them quite cheap.
• 7:27
  SPEAKER_00: If it is the right property, you can get them at a very good price, and then you could reclate it yourself because you've got the skills, you've got the team, you can do that.
• 7:35
  SPEAKER_00: And I had that again, like I had a builder client a couple of years ago that wanted to buy the property, regardless of how many times I warned them against it.
• 7:42
  SPEAKER_00: They're like, no, no, no, we know what we're doing, we're just gonna take the risk.
• 7:47
  SPEAKER_00: And from the bank point of view, as long as you've got at least 20 to 30 percent equity, you're okay.
• 7:53
  SPEAKER_00: So, usually for those sort of properties, you cannot buy them with 10% deposit or even 5% deposit.
• 7:58
  SPEAKER_00: You know, you have to have quite a lot of equity in it.
• 8:00
  SPEAKER_00: Because if once you move in and things go wrong, or you want to reclad and you want to go back to the bank, then at least there's some equity to play with.
• 8:08
  SPEAKER_01: Yeah.
• 8:08
  SPEAKER_00: Yeah.
• 8:09
  SPEAKER_00: Now, this is a very good story.
• 8:10
  SPEAKER_00: Thank you so much.
• 8:11
  SPEAKER_00: No worries.
• 8:12
  SPEAKER_00: If you've got any photos, send it to me.
• 8:13
  SPEAKER_00: No, don't.
• 8:15
  SPEAKER_00: Thank you, Evan.
• 8:16
  SPEAKER_01: Cheers.