The insurance crisis and new requirements on building certifiers could push up the price of building a house in Canberra by thousands of dollars.
Insurance costs are skyrocketing as building certifiers renew their indemnity policies, with insurers now excluding combustible cladding from policies or adding huge excesses for cladding claims.
On top of that, the ACT government introduces a new code of practice from September, which certifiers say effectively makes them responsible for building design, drastically increasing their role and liability.
"They went way over the top," certifier David Delchau said. "It was just dumped on us."
Certifiers faced, for example, having to engage a geotechnical engineer to sign off on footings, and employing structural engineers and surveyors to visit sites.
Mr Delchau, of Certified Building Solutions, said while people building homes paid $1500 to $2000 for a home certifier now, they could face fees of well over $10,000 and perhaps as much as $20,000 under the new code of practice.
On top of that, insurance costs would also have to be passed through.
Livi Krevatin said certifiers were in a "dire situation of stress", as costs and liabilities increased and they lived with a nagging doubt about whether they could be sued.
Mr Krevetin renewed his insurance in May so avoided exclusions on his policy, but his premium increased from $5000 to $11,000 and he was anticipating a "huge increase" when it expired in May next year.
He wouldn't take on work involving combustible cladding. Nor would he go near high-rise buildings because the risk was too high, he said.
But he still had sleepless nights about buildings he had approved, given the lack of certainty about what could be caught up in a definition of combustible cladding.
"That's what everybody's thinking about. Are we going to get sued in five years' time when somebody's house catches fire with foam cladding ... We're just out there hanging like a ripe cherry on a tree waiting for something to go wrong," he said.
"... We're all in this dire situation of stress. I can't sleep sometimes honestly."
Mr Krevetin was referring to the foam cladding made from "expanded polystyrene" and rendered to look like rendered cement. It is commonly used in Canberra homes and not caught up in the insurance crisis, but certifiers are worried about what what might come next given the uncertainty about insurance.
They're also worried about whether they are covered when they approve a building with one material and a different version ends up being used.
Steve Monkhouse, from Capital Certifiers, signed a new insurance policy on June 30. His premium soared from $24,000 to $108,000, an increase that he said he had no choice but to pass on to home builders.
His excess had jumped from $10,000 to $20,000 - but any claims involving combustible cladding have an excess of $175,000 under the new policy.
He plans to hike fees about 20 per cent but said certifiers with the new, more expensive insurance were having to compete with those whose policies were yet to come up for renewal, putting more pressure on their businesses.
He was now rethinking whether to certify apartment buildings at all - and said other certifiers were doing the same.
Mr Delchau said in Canberra, the law said certifiers must be "adequately insured", but with insurers exempting combustible cladding it was unclear what might be judged adequate and whether certifiers could be left liable.
"If there's a combustible material, they won't cover it," he said.
Until July 1, certifiers could get insurance without exclusions, but the company providing that cover had now quit the market. As policies came up for renewal, certifiers were facing big increases in premiums and policies with exemptions.
His insurance was due in September.
"We have to decide personally whether we want to take on that risk and continue in this role," he said. "I've spoken to many people around Canberra who will say no, why would I put my house on the line to cover a builder or a developer or an architect for something which I'm not in direct control of...
"To my mind, you would be mad to self-insure for this issue."
Minister for Building Quality Improvement Gordon Ramsay said he made "no apology for ensuring that Canberrans live in the safest and highest quality buildings".
"I intend to make sure the industry is guided by clear expectations and that people in the certification process understand various building-related rules and have the necessary skills," he said.
"... The new code of practice will help industry and consumers understand what to expect when they engage a building surveyor.
The government said the ACT's building cladding review had started with public health and education buildings and would include apartments, hotels and student accommodation.