Apartment Defects

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GUEST OBSERVATION
If you own an apartment – or are thinking of buying one – the recent news about building quality <a href="https://theconversation.com/would-you-buy-a-new-apartment-building-confidence-depends-on-ending-the-blame-game-122180">has been worrying</a>. There have been evacuations at the <a href="https://theconversation.com/there-are-lessons-to-be-drawn-from-the-cracks-that-appeared-in-sydneys-opal-tower-but-they-extend-beyond-building-certification-109428">Opal</a> and <a href="https://www.propertyobserver.com.au/https://www.abc.net.au/news/2020-11-24/mascot-towers-apartment-owners-still-living-in-limbo/12911968">Mascot</a> apartment towers in Sydney, cladding fires at the <a href="https://theconversation.com/lacrosse-fire-ruling-sends-shudders-through-building-industry-consultants-and-governments-112777">Lacrosse</a> and <a href="https://theconversation.com/cladding-fire-risks-have-been-known-for-years-lives-depend-on-acting-now-with-no-more-delays-111186">Neo200</a> towers in Melbourne and the <a href="https://theconversation.com/grenfell-tower-inquiry-expert-explains-four-main-findings-and-how-emergency-services-must-improve-126163">Grenfell Tower tragedy</a> in London. While most buildings won’t have such serious defects, many do have significant problems, and owners must get these fixed so they aren’t a health and safety risk.
Even if the defect doesn’t affect their apartment, this is often the shared responsibility of all owners in the building. It’s essential they have access to good guidance on dealing with defects in strata properties – but this isn’t always easy to find. To help owners, we’ve worked with the <a href="https://nsw.strata.community/">Strata Community Association (NSW)</a> to produce a <a href="https://cityfutures.be.unsw.edu.au/research/projects/defect-rectification/">free guide to rectifying defects</a>.
<a href="https://images.theconversation.com/files/372949/original/file-20201203-23-1770psg.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/372949/original/file-20201203-23-1770psg.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="screenshot of strata defects rectification guide home page"></a> The online guide to rectifying defects takes apartment owners step by step through what they should do. <a class="source" href="https://cityfutures.be.unsw.edu.au/research/projects/defect-rectification/">City Futures Research Centre, UNSW/SCA (NSW)</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a>
This how-to guide takes current and potential owners through the steps of identifying and rectifying defects, with links to helpful resources. It includes advice on getting a defect report, whether the developer or builder might be responsible for fixing the issue, how to choose and manage building experts, and how to manage communication with owners and workers.
The guide has been developed for New South Wales, but may also be helpful if you have a strata property elsewhere in Australia.
So what key things should owners know?
Each building’s experience with defects will differ. But there are some key principles owners should always keep in mind – these underpin all the advice in our guide.
Ignorance isn’t bliss: as an owner, you are automatically a member of the <a href="https://www.fairtrading.nsw.gov.au/housing-and-property/strata-and-community-living/strata-schemes">owners corporation/body corporate</a>. This means you have a legal <a href="https://www.fairtrading.nsw.gov.au/housing-and-property/strata-and-community-living/strata-schemes/responsibilities-of-the-owners-corporation">responsibility to maintain and repair the common property</a>, including dealing with defects.
Information is power: gather all the information you can when investigating defects. For buyers, a good strata report is essential. For owners of new buildings, getting a professional defects report is particularly important. It’s worth the cost.
Focus on potential fire, waterproofing or structural issues. These defects can be hard to see but expensive to fix. They also have major impacts on health and safety.
The early bird catches the worm: you can never start looking for and dealing with defects too early. Be aware of time limits on building warranties.
In NSW, for minor defects, you have two years to start the process of getting the builder or developer to fix the defect. For major defects, you have six years. If your building is outside the warranty period, you may have to fund rectification yourself.
Sharing is caring: make sure you report defects to people who need to know. This will include your owners corporation, but also your insurer(s) and <a href="https://www.fairtrading.nsw.gov.au/help-centre/online-tools/make-a-complaint">Fair Trading</a> (especially if the defect is major).
Keeping good records is also important. Records are needed in case there are disputes and to show future buyers the building is well-maintained.
Look after yourself: dealing with defects can be financially and emotionally draining. Conflict can occur, and collective decision-making can feel very slow.
To help navigate the process, you want the best experts by your side. They include lawyers, building specialists, strata managers and project managers. And always get a second opinion if in doubt.
What else can be done to improve the situation?
While our guide will help apartment owners and buyers to work through defect issues, state and territory governments could also do more to help out owners.
Since the Opal Tower evacuation, the NSW government has <a href="https://www.fairtrading.nsw.gov.au/about-fair-trading/legislation-and-publications/changes-to-legislation/building-industry-reforms">moved to tighten building laws</a> to reduce future defects.
These legal changes are important, but they are unlikely to completely get rid of building defects. And buildings built before the new laws might still have problems down the track.
One way governments can help owners who face such issues in the future is to make it easier for them to get the information they need to deal with defects effectively and efficiently.
Currently, strata buyers and owners suffer from what economists call “<a href="https://theconversation.com/lack-of-information-on-apartment-defects-leaves-whole-market-on-shaky-footings-127007">information asymmetry</a>” – they don’t have access to all the information they need to make informed decisions about building quality. For example, developers might not give new owners all the details about how their building was built, what materials were used, or which builders and tradespeople worked on it.
Developers should be required to give owners better information, as well as taking more responsibility for fixing defects.
Owners corporations should be encouraged to keep building records on defects up-to-date and make this information available to prospective buyers and relevant authorities.
And governments should support further professionalisation of the strata and building management industries, to make sure owners have the best possible support to navigate defects issues and care for their buildings.<img src="https://counter.theconversation.com/content/150292/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
<a href="https://theconversation.com/profiles/sian-thompson-301831">Sian Thompson</a>, Research Associate, City Futures Research Centre, <a href="https://theconversation.com/institutions/unsw-1414">UNSW</a>; <a href="https://theconversation.com/profiles/bill-randolph-147968">Bill Randolph</a>, Director, City Futures Research Centre, Faculty of the Built Environment, <a href="https://theconversation.com/institutions/unsw-1414">UNSW</a>; <a href="https://theconversation.com/profiles/hazel-easthope-175163">Hazel Easthope</a>, Scientia Associate Professor, City Futures Research Centre, <a href="https://theconversation.com/institutions/unsw-1414">UNSW</a>; <a href="https://theconversation.com/profiles/laura-crommelin-15376">Laura Crommelin</a>, Research Lecturer, City Futures Research Centre, <a href="https://theconversation.com/institutions/unsw-1414">UNSW</a>, and <a href="https://theconversation.com/profiles/martin-loosemore-4690">Martin Loosemore</a>, Professor of Construction Management, <a href="https://theconversation.com/institutions/university-of-technology-sydney-936">University of Technology Sydney</a>
This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/dealing-with-apartment-defects-a-how-to-guide-for-strata-owners-and-buyers-150292">original article</a>.
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j.ballantyne1990-6AQqhLzZaK

Dealing with apartment defects: a how-to guide for strata owners and buyers

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New and prospective homeowners will have protections against purchasing defective residential apartment buildings from tomorrow, when the NSW Government’s landmark Residential Apartment Buildings Act 2020 comes into effect.
Minister for Better Regulation Kevin Anderson said the new laws work to prevent buildings with serious defects going on the market, and give clear recourse in the event of a defect.
“The days of shonky certifiers and dodgy developers ripping off unknowing apartment buyers are numbered. They are officially on notice – we can now stop you pushing defective buildings onto consumers,” Mr Anderson said.
From tomorrow, September 1 the Office of the NSW Building Commissioner will have the power to stop defective apartment blocks from being built and sold.
"Developers who have done the wrong thing can also face huge fines," Mr Anderson said.
The changes include a compulsory six-month notification that a developer will be applying for an occupation certificate; powers to withhold an occupation certificate where the building is not up to scratch; the ability to order rectification of any serious defect and recover costs associated with that rectification; and on-the-spot inspections of buildings up to six years old, and in extreme circumstances up to 10 years old.
“These new powers provide a massive increase in the level of assurance and protection for consumers. They are a critical step in the NSW Government’s commitment to restoring consumer confidence in the building sector,” Mr Anderson said.
NSW Building Commissioner David Chandler OAM said they send a clear signal to the construction sector that sub-standard projects will not be tolerated. 
“Our sights are set on the small percentage of industry players who aren’t doing the right thing. Whether you are a builder cutting corners, or a certifier passing work that isn’t good enough – expect action from our new team of inspectors,” Mr Chandler said.
“We acknowledge, however, that sometimes things may not always go to plan, and I want to assure industry that we will work constructively during the audit process with parties who are trying to do the right thing to help resolve issues efficiently.”
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Apartment Defects

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