The dark side of the boom24 August 2017
You need only look up from the footpaths of Sydney to bear witness to the apartment boom that has occurred in recent years. Significant increase in demand, plus a gross undersupply of housing in the city centre, has meant apartment development has been the main option to accommodate Sydney's growing population.
Construction work from growth can only be a good thing, right?
There have been some problems. The UNSW City Futures Research Centre conducted a survey in 2012 that found approximately 85% of strata owners living in post-2000 structures had reported major defects in their building. It's not uncommon for owners to spend years going through the courts to recover repair costs, only for the original developer or builder to end up bankrupt or placed into administration before the process is over, leaving owners to foot the bill.
Can we fix it? Yes, we can (try)!
From 1 January 2018, developers and builders of residential and mixed-use strata buildings will be required to lodge a bond with NSW Fair Trading. The bond amount will be equivalent to 2% of the contract price and will be used to cover any costs of rectifying building defects in the event they refuse, or are unable to, rectify the defects themselves. For more detailed information, take a look at an article from Grant Parker in our Construction, Projects & Infrastructure team.