Happy New Year! Two pieces of legislation come into play today. The first sees the long-awaited defects bond for new apartment blocks come into effect. The other sees what seems to be a backdated limit on claiming travel expenses for managing your investment property.
The defects bond means that developers have to deposit two percent of the contract cost of their buildings in a fund that sits there for two years so that owners aren’t left high and dry when the developers morph into another entity, leaving all their bills for shoddy wory behind them. Sounds good?
Yeah, in theory. But pessimists (aka, anyone who has ever bought an apartment off the plan) will say that this just locks defects into the developers’ budgets, so shoddy work will increase, not decrease. Developers will just add the two percent to the cost of the units so you are no better off anyway.
And those same lovely people will move heaven and earth to make sure we, the customers, can’t get our grubby little hands on very much of the money at all. Oh, and two percent isn’t even close to what will be required to fix some of the horrors we’ve seen over the past few years.
The latest from the Flat Chat Forum.
OK, it’s the holiday season and you’ve all been too busy smoking out your neighbours with your barbecues, partying all night till the cops come and leaving nasty notes on cars parked in your spaces. But the Flat Chat Forum still rolls along. Here’s the latest
- My neighbour drove me nuts with Boxing Day renos – That’s HERE.
- New neighbour wants to move fence in nasty land grab. It’s quite a saga. – That’s HERE.
- Do I have to replace a non-code bannister before it needs repair? That’s HERE.
- How do I beat the noisy brat dumped next door – That’s HERE.
We’ll all be back to what passes for normal in Strataland soon. Keep checking in for our latest tales of discomfort and occasional joy.
Optimists will say that now that the principle of a defects bond has been established, the government can tweak the percentage so they more closely match the requirements of the industry.
The second, starting in the current tax year, limits travel expenses for managing your investment property, so that annual trip to Singapore to discuss what you’re going to do about your investment property in Bankstown is definitely not deductable now (if it ever was).
You’ll find the Government release on this HERE and here’s the defects bond press release from Fair Trading, in full:
Home buyers will be better protected thanks to an Australian-first defect bond scheme, Minister for Better Regulation Matt Kean said.
The Strata Building Bond and Inspections Scheme (the Scheme), the first of its kind in Australia, provides a structured process to rectify defects early in the building lifecycle.
Mr Kean said the new Scheme follows extensive industry consultation, and aims to reduce costs for both developers and buyers, cut time delays in rectifying issues, and minimise expensive and time consuming legal action.
“Developers will now be required to lodge a building bond, which is equal to two per cent of the contract price with NSW Fair Trading,” Mr Kean said.
“The building bond can then be provided to owners’ corporations to rectify any defects – protecting consumers from developers walking out on dodgy or unfinished work.”
Mr Kean said the Scheme will enhance Fair Trading’s ability to verify the contract price provided by a developer via an independent assessor.
“There will also be a mandated independent building inspector so everyone involved can have confidence that they’re getting a fair go,” Mr Kean said.
As the Scheme kicks off, Fair Trading has released the requirements for the strata specific building inspections.
“The inspections and reports document will ensure a consistent approach to the identification and rectification of defects across NSW,” Mr Kean said.
For more information about the Strata Building Bonds and Inspection Scheme, go to fairtrading.nsw.gov.au.