Combustible cladding explained — buying an apartment in NSW and Victoria

The short version

Some apartment buildings were clad in combustible external panels that can help a fire spread up the outside of the building. After two well-known fires, both NSW and Victoria set up programmes to find affected buildings and get the cladding replaced. If you buy into a building that still has it, the cost and the disruption of fixing it can land on you as an owner — usually through the owners corporation and its levies. None of that means you should avoid apartments; it means the cladding question is one to ask before you sign, not after. The answer is usually sitting in the strata records, and there are state registers and remediation programmes that tell you where a building stands.

What combustible cladding is

The material at the centre of the issue is aluminium composite panel (ACP) with a polyethylene core — two thin metal skins sandwiching a plastic filler. It was widely used as a lightweight, cheap façade finish, but the plastic core can burn, and on a tall building that lets a fire climb the outside wall far faster than it should. Some forms of combustible expanded polystyrene render systems raise similar concerns. Not all aluminium panels are dangerous — fire-rated and mineral-core versions exist — which is exactly why buildings have to be individually assessed rather than judged by looks.

Why it became an issue

Two fires drove the response. In 2014, a discarded cigarette started a fire that ran up the cladding of the Lacrosse tower in Melbourne's Docklands. In 2017, the Grenfell Tower fire in London killed 72 people and put combustible cladding on the agenda worldwide. Australian regulators audited thousands of buildings, and both NSW and Victoria built dedicated programmes to deal with the ones that failed.

What NSW does about it

NSW ran a statewide audit and required owners of affected buildings to register the cladding with the state, so government and fire services knew where the risk sat. For eligible residential apartment buildings, the government set up Project Remediate — an interest-free loan and project-management programme that helps owners corporations replace dangerous cladding without having to fund the whole job up front. Alongside that, the statutory duty of care in the Design and Building Practitioners Act 2020 (NSW) can let an owners corporation pursue those responsible for the defective work, and it reaches current and later owners of the building. The NSW Building Commission oversees the wider response.

What Victoria does about it

Victoria created Cladding Safety Victoria to deliver the state's cladding rectification programme after the Victorian Building Authority's statewide audit. For the higher-risk buildings it assessed, the programme helps fund and manage the works, drawing on state funding and a levy tied to certain building permits under the framework of the Building Act 1993 (Vic). Whether a particular building is in the programme, and how far its works have progressed, is something to confirm rather than assume — the programme has focused on the buildings that scored highest for risk, not every building with any cladding at all.

Why it becomes your problem

External walls are common property, so cladding is the owners corporation's responsibility, not any single owner's. That is a double-edged thing. It means you are not personally arranging the works — but it also means the cost is shared across all the lots, and it reaches whoever owns the lot when the money is called for. If remediation isn't covered by a programme, or a programme only covers part of it, the shortfall usually arrives as a special levy. A building that has quietly deferred the work, or hasn't yet been assessed, is carrying a cost that hasn't been struck yet. Cladding can also affect the building's insurance — higher premiums, exclusions, or difficulty getting cover at all until the work is done.

What to check before you sign

1. Ask directly whether the building has combustible cladding. Put the question to the agent and the owners corporation in writing, and don't settle for "it's fine" — ask what assessment it's based on.
2. Read the strata records for cladding talk. A strata records inspection should reveal any fire-engineering report, a cladding assessment, correspondence with the state programme, or minutes discussing remediation.
3. Find out whether works are funded. If cladding needs replacing, ask whether it sits within a government programme, what the owners corporation still has to fund, and whether a special levy has been — or is about to be — struck.
4. Check the capital works fund. A thin capital works fund next to an unresolved cladding problem is a strong sign a levy is coming.
5. Confirm the insurance still covers the building properly. Ask whether the cladding has affected the premium, the cover, or the sum insured.

Common questions

How do I know if a building has dangerous cladding?

You usually can't tell by looking — fire-rated and combustible panels can look identical. The reliable sources are the building's own assessments and the strata records, plus the state registers and remediation programmes. If the owners corporation can't point to a clear assessment either way, treat that uncertainty as part of the risk you'd be buying.

Does combustible cladding let me out of the contract?

Not on its own. Once you've exchanged, a cladding problem is generally something you've taken on with the lot, which is why the question belongs before you sign. The protections and programmes are about getting the cladding fixed and helping fund the work — not about unwinding your purchase.

Is remediation always covered by the government?

No. The NSW and Victorian programmes target eligible, higher-risk buildings, and even then they may not cover every cost. Some owners corporations fund the work themselves. So the useful question isn't just "is there a programme?" but "what does this building still have to pay, and when?" For the wider picture on new-building risk, see our guide to building defects in new strata, and pull the strata checks together with everything else using the NSW contract review checklist.