Australia’s Leaky Building Crisis: A Hidden Catastrophe
- Elliot Saha
- Jun 6
- 6 min read
Updated: Jul 15
Australia is facing a growing and deeply troubling issue in its built environment: widespread water infiltration and waterproofing failures in residential buildings — a phenomenon commonly referred to as the “Leaky Building Syndrome.” This crisis is not only causing billions in damages but also eroding public confidence in the construction industry.
What Is the Leaky Building Syndrome?
Leaky Building Syndrome occurs when the external envelope of a building fails to prevent water from entering, often due to faulty design, construction, or materials. In Australia, this issue has become increasingly common in newly built apartment complexes and townhouses.
A report by the Victorian Building Authority found that 85% to 97% of insurance claims on multi-residential buildings involved water-related defects, with balconies being the most frequent source of failure¹. In New South Wales, a comprehensive survey revealed that 97% of apartment buildings had at least one defect — with waterproofing being the most common 2. Queensland reported similar issues, with 71% of multi-residential buildings showing defects, many involving moisture intrusion².
What’s Causing the Crisis?
Several systemic issues have contributed to the scale of this problem:
Poor Construction Practices: Improper installation of waterproof membranes, over-reliance on sealants, and failure to integrate proper flashing details have been cited as key issues.³
Design Flaws: Zero-threshold balconies, inadequate drainage slopes, and poorly designed roof systems are more susceptible to moisture ingress.³
Regulatory Oversight Failures: Building regulation and inspection practices have not kept pace with rapid development, leaving many defects unnoticed until after construction is complete.⁴
Fragmented Accountability: In large multi-residential projects, responsibilities are often split among developers, builders, subcontractors, and certifiers — making it difficult to assign blame or secure compensation when defects emerge.
The Consequences for Homeowners
For affected homeowners, the fallout can be devastating:
Financial Strain: Repairs for leaky buildings can cost hundreds of thousands of dollars per apartment, often not covered by warranty or insurance.
Health Risks: Moist environments promote mould growth, which can cause respiratory issues and other health complications.
Loss of Trust: Many Australians feel let down by the industry and by regulatory bodies that failed to ensure their homes were safe and durable.
With around 150,000 to 170,000 new homes being built every year, experts warn that thousands of properties with latent water defects are entering the housing market annually — a systemic problem that may only fully reveal itself years down the line. As Zeher Khalil an industry expert put it: “These are ticking time bombs”. In many cases, these buildings begin to show serious signs of deterioration well before they reach 10 years old — a lifespan shockingly short for what should be long-term assets.⁴
What Can Be Done?
To stop the crisis from escalating further, the industry and government need to take urgent steps:
Stronger Regulation and Enforcement: National building codes must mandate more robust waterproofing standards, and states should invest in independent inspection regimes.
Skilled Labour and Training: Builders and contractors need better training in moisture management, detailing, and material performance.
Product Innovation and Monitoring: New technologies like moisture sensors, leak detection systems, and smart membranes can provide early warnings of failures.
Consumer Protections: Legal reforms should allow homeowners to more easily recover costs from negligent parties.
Conclusion
Australia’s leaky building crisis is more than a construction flaw — it’s a systemic failure affecting public health, financial stability, and faith in the built environment. If left unaddressed, it will continue to erode the foundations — literally and figuratively — of housing in Australia. But with coordinated action, stronger oversight, and a culture of accountability, this crisis can be contained before more buildings — and families — are affected.
References
ABC News. (2023, March 18). Leaky buildings a looming crisis as poor waterproofing leaves apartments riddled with water damage. Retrieved from https://www.abc.net.au/news/2023-03-18/leaky-buildings-poor-waterproofing-practices-experts-fear-crisis/102089312
LinkedIn. (2022). Australia’s High-Rise Waterproofing Crisis Laid Bare. Retrieved from https://www.linkedin.com/pulse/australias-high-rise-waterproofing-crisis-laid-bare-
Agile Approvals. (2023). Is Australia going to experience a wave of Leaky Building Syndrome like NZ and Canada? Retrieved from https://agileapprovals.com.au/blog/is-australia-going-to-experience-a-wave-of-leaky-building-syndrome-like-nz-and-canada
News.com.au. (2022). Millions of Aussies sitting on ticking time bombs as serious building defects become the norm. Retrieved from https://www.news.com.au/finance/real-estate/millions-of-aussies-sitting-on-ticking-time-bombs-as-serious-building-defects-become-the-norm/news-story/2bdb5541c64316200b5e94e9d4db2676
Australia is facing a growing and deeply troubling issue in its built environment: widespread water infiltration and waterproofing failures in residential buildings — a phenomenon commonly referred to as the “Leaky Building Syndrome.” This crisis is not only causing billions in damages but also eroding public confidence in the construction industry.
What Is the Leaky Building Syndrome?
Leaky Building Syndrome occurs when the external envelope of a building fails to prevent water from entering, often due to faulty design, construction, or materials. In Australia, this issue has become increasingly common in newly built apartment complexes and townhouses.
A report by the Victorian Building Authority found that 85% to 97% of insurance claims on multi-residential buildings involved water-related defects, with balconies being the most frequent source of failure¹. In New South Wales, a comprehensive survey revealed that 97% of apartment buildings had at least one defect — with waterproofing being the most common 2. Queensland reported similar issues, with 71% of multi-residential buildings showing defects, many involving moisture intrusion².
What’s Causing the Crisis?
Several systemic issues have contributed to the scale of this problem:
Poor Construction Practices: Improper installation of waterproof membranes, over-reliance on sealants, and failure to integrate proper flashing details have been cited as key issues.³
Design Flaws: Zero-threshold balconies, inadequate drainage slopes, and poorly designed roof systems are more susceptible to moisture ingress.³
Regulatory Oversight Failures: Building regulation and inspection practices have not kept pace with rapid development, leaving many defects unnoticed until after construction is complete.⁴
Fragmented Accountability: In large multi-residential projects, responsibilities are often split among developers, builders, subcontractors, and certifiers — making it difficult to assign blame or secure compensation when defects emerge.
The Consequences for Homeowners
For affected homeowners, the fallout can be devastating:
Financial Strain: Repairs for leaky buildings can cost hundreds of thousands of dollars per apartment, often not covered by warranty or insurance.
Health Risks: Moist environments promote mould growth, which can cause respiratory issues and other health complications.
Loss of Trust: Many Australians feel let down by the industry and by regulatory bodies that failed to ensure their homes were safe and durable.
With around 150,000 to 170,000 new homes being built every year, experts warn that thousands of properties with latent water defects are entering the housing market annually — a systemic problem that may only fully reveal itself years down the line. As Zeher Khalil an industry expert put it: “These are ticking time bombs”. In many cases, these buildings begin to show serious signs of deterioration well before they reach 10 years old — a lifespan shockingly short for what should be long-term assets.⁴
What Can Be Done?
To stop the crisis from escalating further, the industry and government need to take urgent steps:
Stronger Regulation and Enforcement: National building codes must mandate more robust waterproofing standards, and states should invest in independent inspection regimes.
Skilled Labour and Training: Builders and contractors need better training in moisture management, detailing, and material performance.
Product Innovation and Monitoring: New technologies like moisture sensors, leak detection systems, and smart membranes can provide early warnings of failures.
Consumer Protections: Legal reforms should allow homeowners to more easily recover costs from negligent parties.
Conclusion
Australia’s leaky building crisis is more than a construction flaw — it’s a systemic failure affecting public health, financial stability, and faith in the built environment. If left unaddressed, it will continue to erode the foundations — literally and figuratively — of housing in Australia. But with coordinated action, stronger oversight, and a culture of accountability, this crisis can be contained before more buildings — and families — are affected.
References
ABC News. (2023, March 18). Leaky buildings a looming crisis as poor waterproofing leaves apartments riddled with water damage. Retrieved from https://www.abc.net.au/news/2023-03-18/leaky-buildings-poor-waterproofing-practices-experts-fear-crisis/102089312
LinkedIn. (2022). Australia’s High-Rise Waterproofing Crisis Laid Bare. Retrieved from https://www.linkedin.com/pulse/australias-high-rise-waterproofing-crisis-laid-bare-
Agile Approvals. (2023). Is Australia going to experience a wave of Leaky Building Syndrome like NZ and Canada? Retrieved from https://agileapprovals.com.au/blog/is-australia-going-to-experience-a-wave-of-leaky-building-syndrome-like-nz-and-canada
News.com.au. (2022). Millions of Aussies sitting on ticking time bombs as serious building defects become the norm. Retrieved from https://www.news.com.au/finance/real-estate/millions-of-aussies-sitting-on-ticking-time-bombs-as-serious-building-defects-become-the-norm/news-story/2bdb5541c64316200b5e94e9d4db2676
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