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SQMresearch sqmresearch.com.au tracks asking prices for real estate. Units don’t seem to be affected much, but houses are decreasing. Whether this is from rate rises or from tax changes is debatable. The Australian economy is a bit of a mystery. While unemployment increased, the average hours worked by all adults increased. The RBA will be watching what the employment figures are when they come out this week. What the RBA is mainly trying to do is to reduce new borrowing, which is increasing at a ridiculous rate, but they will expect other effects due to lower demand.
Running electricity to individual car spaces will be a pain. It will probably be quite expensive to run one, but unless the government provides some sort of program, they are unlikely to want to do all spaces. There are already problems in some areas due to replacing gas with electricity, adding in EV charging is going to increase the risk that substations etc will need to be upgraded. I heard about one where they wanted fast charging and just the cost of substation and wiring improvements was $375k for 24 units. It is a good time to be an electrical engineer.
I wonder if smashed avo is and similar is the sort of thing that would concern them. Say that someone gets that or an egg and bacon roll each morning for breakfast, they can easily replace it with something made at home which is probably healthier. The real problem is the things they can’t stop paying money for, like the tolls that they need because they have to take a car to work. Plus the car servicing and insurance. I suspect that the banks are getting worried because they may have significant numbers in negative equity when the inevitable recession happens, especially when you add in the costs of getting people out of their houses.
The only solution is for the building commissioner to look at some of the reports and remediation plans by engineers and the costing from builders and determine if these are reasonable. The previous comment has been asked for $200k per unit, when a typical unit build cost is about $500k. I’m starting to think that $200k per unit is standard fee for builders, or maybe for small unit blocks they make it about $3m for the total.
Water and balconies is a bad mixture, it may actually be entering the structure of the balcony and hence to the building structure. If I knew before buying what I know now, then I would not have bought a strata.
The law is very simple. The person driving the car has been negligent and it is their responsibility to pay for the repairs. If the car has comprehensive or third party property that includes the person as driver then their insurer will pay, otherwise they should pay. Now if they can’t pay then either the strata insurer or the strata can pay, and they will then attempt to recover the money. Discuss this with the strata insurer. Don’t even think of giving false information to the insurer. I would also be careful of using the [strata] insurance at all for minor damage [to common property]. The insurance company will probably just push up the premiums to cover what they paid out.
The capital works fund plan initially requires a surveyor to check the correctness, but it still doesn’t require them to be updated and checked when problems with the building are found. Our one is basically a work of fiction, even though the building defects have been known for over 10 years. The plan has never included remediation. Their is no record of the capital works plan not being followed, one is the external painting because it would be like putting lipstick on a pig.
Wait until people start losing their jobs, and that pushes rents and housing costs down. Michelle Bullock wanted to say that governments are doing things that push inflation up, so it has been left to the RBA to push it down with its one very blunt weapon.
Other units not having an issue doesn’t lessen the problem. If the OC doesn’t feel that they should do anything then it is left up to the owner to obtain the evidence and ways of rectifying, and take that to the tribunal, and they can then decide whether it is an OC problem, which is likely because the water is coming through the common property.
So, it seems that the problem are that engineers are specifying excessive requirements, and then there aren’t enough waterproofers so they are all pushing the prices up. One quote for our remediation was half of what would be charged to build a whole new block of units.
My reading of the rules is that bathrooms are exempt unless there is more than one dwelling, in which case the paper work needs to be done. I haven’t gone through all the rules, but one difficult requirement is that waterproofing has to be done as a single sheet. Much fun because the bathrooms in mystery strata have tiles to the ceiling, resulting in a big job, to fix what is needed which is probably just the base of the shower. Or is that interpretation correct?
If something fails in the structure, that isn’t caused by an occupier, then it is the owners corporation responsibility.
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The cost came in at a projected $120K to lift all the tiles, replace the waterproofing and re-tile (new tiles) and by the way, replace the balustrade because it was 10cm short of current standards. For a leak? The explanation was that the job could only be done under the supervision of an engineer because it involved waterproofing, and the balustrade came into the picture because the tiles came up to the lower edge of the balustrade which brought it into the scope of works. Needless to say, we didn’t go ahead with that job. Rather, we had the whole terrace re-grouted at a cost of $19K. So far, no further leakage has been reported. Something is seriously wrong here.
You are probably not allowed to do that anymore. The whole thing is ridiculous. We have 40 leaking bathrooms, but all of them will be the shower. We could replace the grout for about $1000 a shower, or retile the shower for $5,000 but that is not allowed, we have to remove all tiles in the bathroom, which means removing the fixtures, seal the whole bathroom and replace the tiles and fixtures at at least $30,000 per bathroom. I’m not certain what happens if we have one badly leaking shower because that puts us above the $5K limit.
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One thing about these remediations is that the costs are so high that very few strata will be able to get enough votes to see them go ahead, and that means we are at the mercy of the developers.
If we assume $650k for a sale price per unit, and remediation costs of $200k, developers costs of $90k (loan, stamp duty, marketing) and profit of $60k, that makes their buying price about $300k. Land valuation is $140k. Is that a reasonable breakdown of the price, or is a developer just going to offer the land valuation and make lots of money? Or maybe somewhere in between.
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One question is whether anyone has made or is likely to make this a political issue. Does the OCN have any position on this? Or maybe the opposition? Maybe the government is getting worried? I sent an e-mail to my local member about Christmas and got a reply that they were all very busy, and nothing since. Where I am, if they checked for waterproofing problems in unit blocks it would range from a few units to we have to redo every balcony.
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I’d love to see $80,000, our best quote is $200,000 per lot. We are seeking more quotes.
There are obvious problems with what is happening. We have about 40 bathrooms that have water leakage. If it was a home then we would pay about a $1,000 to use something like Megaseal or retile the shower at about $5000, and it would usually bey fix any problems.. The regulations say that the waterproofing has to be one continuous seal, so all fixtures are to be removed, all tiles removed and the sealing and retiling. This was something like $30-40k per bathroom and they aren’t big bathrooms.
Balconies are a disaster. They are to be stripped back to concrete, checked for concrete cancer and then everything is replaced. Brick walls on balconies need to replaced, as now required to be reinforced.
When I first read the tender, I thought the engineers response to all problems was to replace everything, but that is what they have to do.
Anyway, many of our owners couldn’t afford to pay even $50-100k, so we are all going to be removed kicking and screaming from the building, due to an appointed strata manager. It isn’t going to be nice when eventually we have to do everything and the only choice is to sell to a developer at less than half what people have paid.