A special fund like the one New Zealand uses to help homeowners rebuild after earthquakes is being suggested for NSW as hundreds of Sydney residents deal with the fallout from building defects.
The City of Sydney has this week confirmed about 30 units in Zetland were evacuated by the building's owners in late 2018.
Council staff who inspected the Gadigal Avenue building in February found part of the building vacant with extensive and severe water damage, and deemed it "unsafe and unfit for occupation".
Owners were reportedly told they had to fix defects at a likely cost of more than $5 million, after settling an insurance claim for just $1.7 million.
One resident in 2017 told her real estate agent she felt unsafe living there, saying lights and fire alarms were corroded and chunks of plaster fell from the ceiling when it rained, the Sydney Morning Herald reported on Thursday.
It follows high-profile evacuations from Sydney Olympic Park's Opal Tower on Christmas Eve and Mascot Towers in mid-June.
The NSW government has committed to appointing a building commissioner and is looking at industry reform, having released a discussion paper on its proposed changes in June.
Owners Corporation Network spokesman Stephen Goddard described the proposals as "good and proper" but said there was also the issue of how to help those in "catastrophic circumstances" who had to leave their homes.
He described an initiative established in earthquake-prone New Zealand where owners corporations paid a levy as part of their building insurance premium to grow a fund for homeowners affected by natural disasters.
"OCN thought that was an important initiative that needs to be further looked at because we have buildings now ... where people can no longer live in their home," he told AAP.
"We will be discussing this further with government to see what we can do about it because there's a real need, an apparent need, to help people in catastrophic circumstances."
The state government last month announced a multimillion-dollar assistance package for residents of the evacuated Mascot Towers.
It involves one-off emergency loans to cover up to $400 per night for temporary accommodation for up to three months - "until liability can be determined and these costs recovered".
On Wednesday, following news of the Zetland evacuations, NSW Premier Gladys Berejiklian was asked if the government would continue to assist displaced owners and occupiers financially.
She said she didn't want to make "grand general statements" but the government was monitoring the situation and would do what they felt was in the best interests of the community.
