Researchers from the University of New South Wales’ Futures Research Centre and the University of Technology Sydney (UTS) have found defects are commonplace and often poorly documented in a systematic review of strata schemes registered over a 10-year period.
A random sample of half of all strata schemes completed in the Sydney, Parramatta, and Canterbury-Bankstown local government areas between 2008 and 2017 was analysed.
Lead author of the report Dr Laura Crommelin said while there have been steps in the right direction towards greater transparency for consumers, much more needs to be done so that purchasers can make informed decisions about what they are buying.
She said: “Over the past 20 years there hasn’t been a thorough process of collecting information about the quality of buildings, and documenting issues with buildings.
“It’s currently almost impossible for a regular consumer to do proper research about what they’re buying – and this is in a system based on the idea of ‘buyer beware’.”
Evidence of defects was found in 26 per cent of the 635 schemes in the sample, but the researchers believe the real number of defects is much higher and has been masked by inadequate reporting and documentation.
For schemes with more robust documentation available, evidence of defects was found in more than half (51 per cent), with more than a quarter (28 per cent) having three or more types of defects.
The most common defects documented were water issues, conservatively estimated to exist in 42 per cent of schemes with more robust data.
Dr Crommelin adds: “The drive to construct more buildings more quickly has been a huge part of the urban planning orthodoxy for the past 20 years, not just in Sydney, but in all cities where higher density development rather than ongoing urban sprawl is seen as a way of dealing with population growth.
“But with the pressures for speed and reduced costs, and the trend towards deregulation, high quality oversight and documentation can be among the first things to fall by the wayside.
“The problem is not simply that there are defects, but also that it is so difficult for prospective apartment buyers to know about defects ahead of purchasing, or to have them rectified once discovered.
“Even good developers have some defects, but it’s about what they do after their discovery – the good developers will come back, they’ll fix the problems, they want to make sure that their clients are happy because they care about their reputation.
“The real concern is the ones who do everything they can to avoid coming back to fix problems.”
She notes that government needs to play a strong ongoing role in ensuring industry transparency and accountability, so that consumers’ personal and financial safety is protected.
Some of the recommendations the report makes to protect consumers include:
- Developers being required to provide new owners with a comprehensive, user-friendly Building Manual;
- Continued strengthening of the building inspection regime, including post-completion;
- Strengthening NSW Fair Trading’s capacity to respond to reports of building defects; and
- Making sure that pre-purchase strata reports are high quality, so that purchasers can do their research about existing buildings