Podcast: Social housing a Sirius miscalculation

As we emerge from our “close contact” self-isolation we are probably going to have to go back into hiding after the selfie we took of ourselves still at work, despite lockdowns, which appeared in the Fin Review last weekend.

Responses have ranged from “a picture-perfect combination of domestic bliss and productivity” to “oh, dear … you look like two crazy old people.”

Of course, either or both of these may possibly be true.

Back to the podcast, on which we discuss how much (or little) the government is getting out of the controversial sale of the Sirius building.

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We look at the new focus on owners corporations who deliberately hide their building’s defects, presumably so they don’t damage the prospects of selling their flats.

And we talk about how buildings’ reputations can be easily harmed when rumours and gossip get out of hand.

We chat about the very shaky start to the new Property Services Experts Panel, with one of the biggest players pulling out.

Plus the new regulations that will require the professionals involved in property development – like architects, engineers and builders – to register their involvement in new schemes.

And we mention Sue’s new book “Daughter of the River Country” the biography of an amazing Aboriginal community leader which is out now, just in time for Naidoc week.

All that and more in this week’s Flat Chat Wrap.

TRANSCRIPTION IN FULL

Jimmy  0:00 
We only have just over 24 hours left in isolation!

Sue  0:06 
Woohoo! I can’t wait to get out. Well, I guess we have got out on three occasions, haven’t we? But, that was purely to have a COVID test.

Jimmy  0:17 
Although yesterday, we walked down to the one at the park.

Sue  0:21 
That was very pleasant.

Jimmy  0:22 
Yeah, just to get out in the sunshine. We’d had two negative tests before that and that test proved negative. So, it’s just a matter of time now.

Sue  0:32 
Yeah, absolutely.

Jimmy  0:33 
Until we’re free!

Sue  0:34 
Yes! Never been so pleased to get out and have somebody stick a thing up your nose, but still!

Jimmy  0:41 
Today, we’re talking about the sale of the Sirius building, or more to the point, what they’re going to do with the money. And, we’re going to talk about the hiding of defects. What else have we got, Sue?

Sue  0:53 
The next phase of the apartment buyer protection.

Jimmy  0:57 
And then, there’s something we should mention, which is the apparent collapse of the whole Property Services Expert Panel.

Sue  1:06 
Oh, really?

Jimmy  1:06 
The estate agents have pulled out.

Sue  1:08 
They were the ones who were lobbying for it! It was their idea.

Jimmy  1:12 
Yeah, and now they’ve pulled out. There’s that and a lot of other stuff coming up. I’m Jimmy Thomson; I write the Flat Chat column for the Australian Financial Review.

Sue  1:22 
And I’m Sue Williams and I write about property for Domain.

Jimmy  1:25 
And this is the Flat Chat Wrap.

[MUSIC]

Jimmy

Okay Sue, what’s the skinny on Sirius?

Sue  1:44 
Well, the New South Wales Government has just announced where the money is going to be spent.

Jimmy  1:49 
We’re talking about what they call the ‘brutalist architecture’ block down close to the Harbour Bridge, with the fabulous views of the Opera House.

Sue  1:59 
That’s right and it was social housing for many, many years. It was built in 1979 and it’s always been very cheap housing for social welfare recipients.

Jimmy  2:09 
I think from the front, it looks like a bar graph, because it goes up to a peak and then comes down again.

Sue  2:15 
Yeah, I can certainly see that.

Jimmy  2:18 
And, that peak could be the huge sums that the developers are going to get for selling the new apartments.

Sue  2:26 
Because, they’ve renovated inside and they paid $150 million to buy it from the New South Wales Government. There have been reports that they now stand to make about $200 million in profits, which is huge. A lot of people are saying “why didn’t the New South Wales Government develop it, itself,” as well as the controversy over all the social housing people being moved out. It’s really interesting, because on Saturday, we were sent a press release, finally announcing where the money is going to be spent. Why deliver that news on a Saturday, one asks?

Jimmy  3:00 
Well, maybe, it’s because of what the news is; how much money are they spending?

Sue  3:05 
They’re spending $150 million, which is what they received for the sale. They’ve already built 38 homes and then they’ve got another 300 on the way, so they’re actually announcing where these houses are going to be built. Guess what? From having some social housing, right in the middle of Sydney, now, the new social housing is going to be…

Jimmy  3:29 
In Vaucluse?

Sue  3:29 
Unfortunately not. It’s going to be in Campsie. That’s the closest (I think), to the middle of Sydney, which is still a way out. Bexley North, Warwick Farm (out west), St. Mary’s, but then, even further away; Gosford up on the Central Coast, Tweed Heads, right on the border. And then we’ve got Dubbo, we’ve got Wagga; Gladys’s ex-boyfriend’s constituency.

Jimmy  3:57 
His stomping ground, yes.

Sue  3:59 
South Kempsey, Nowra, Griffith, South Grafton; like, all a long, long way.

Jimmy  4:06 
Is Gosford in that list?

Sue  4:08 
Yep, Gosford is there.

Jimmy  4:09 
And, up in the Northern Rivers. These are areas where private rentals have been absolutely wiped out by Airbnb type-rentals.

Sue  4:21 
Yeah, so those people just can’t find anything.

Jimmy  4:23 
So, they need housing there and Wagga Wagga (I don’t know what the situation is there), but there’s not an awful lot of places to rent, because I just checked. The weird thing is, you can buy a two-bedroom apartment in Wagga for $300,000, thereabouts. You can get a two-bedroom apartment in Gosford for about $500,000; how many 500,000’s go into $150 million? There should be 2000 houses they’re building; 2000 apartments, and in fact they’re building 350.

Sue  5:05 
Yeah, it’s not many, is it?

Jimmy  5:06 
There’s a big, big, big gap there, between the money that they’re spending and what they’re getting for it.

Sue  5:13 
That’s right. The architect, Tao Gofers, did a column in the Sydney Morning Herald this week; I don’t know if you read it. He was saying that he reckons if the New South Wales Government had planned to do the redevelopment itself, it could have built an extra 400 social housing units.

Jimmy  5:30 
Yeah, absolutely.

Sue  5:32 
It’s a big difference.

Jimmy  5:33 
He was using the same pocket calculator that I am!

Sue  5:37 
That’s right and when you say you can buy a unit out there for $300,000; what a contrast that is, to the apartment that has just sold in Sirius for $35 million.

Jimmy  5:50 
Yeah, I mean, what they’re selling is the view. That fabulous view across Circular Quay, straight to the Opera House and it is worth a lot of money.

Sue  6:03 
It’s interesting, Tao saying he can’t believe it really, because one of the problems with that building has always been the noise level. So, he’s saying that it’s gonna be really noisy for the people who move in there. Who knows?

Jimmy  6:17 
Well, they’ve got better noise mitigation technology in the build now, than they had when that building first went up, you would think. The noise is probably greater now, of course; there’s probably more traffic.

Sue  6:32 
Well, they’re going to have balconies on there, aren’t they? They didn’t have balconies before and one of the reasons he said, was because of the noise. So now, they’re gonna have balconies, it’s hard to see how you can mitigate all that noise, just with a balcony. But, who knows? I don’t know.

Jimmy  6:50 
Yeah, I’m sure they’re working on it. It would be a shame to spend; how much did you say the appointments are costing?

Sue  6:55 
$35 million.

Jimmy  6:57 
And, not be able to tell anybody how much you’d spent, because they can’t hear you. Okay, well, that’s our first scandal. When we come back, let’s talk about the Property Services Expert Panel. That’s after this.

[MUSIC]

Jimmy

So this week, we saw the brand new Property Services Expert Panel basically, start to crumble.

Sue  7:29 
Yeah, because they’re going to set up a Real Estate Commissioner, aren’t they?

Jimmy  7:34 
They wanted a Real Estate Commissioner. See what happened… I mean, it was a mess to begin with, because Fair Trading set the thing up, and basically invited everybody that they could think of who had anything to do with property, except for tenants and owners. The Owners Corporation Network was not invited. The Tenants Union was not invited.

Sue  7:58 
So, everybody involved in property, except the people who live in it?

Jimmy  8:01 
Yes, because what would they know? And, they even extended it to a representative of the Woolgrowers. I mean, I think it’s got something to do with the stock and property agents, who are also there. The short-term rental people; they are there. The strata managers (of course), are there and real estate trainers; they got invited. So this is trundling forward; this mammoth committee, which you suspect is going to look like one of these pictures you get out of China, with the Central Committee of the Communist Party. There’s just rows and rows of seats of people. Then the story came out last week that David Chandler had raised the issue of people selling apartments in buildings that he had said weren’t going to get an occupancy certificate, unless they fix the defects. But still, real estate agents were still selling these apartments without telling purchasers that there was a defects issue. The real estate agents turned around and said “well, where do we get this information?” Like, they don’t read newspaper stories about property. But, that’s what they said. Apparently, it’s really difficult to find the information about which apartment blocks (and by information, I mean, definitive government websites that say this apartment block has got this).

Sue  9:31 
You have to be really proactive to actually find it, don’t you?

Jimmy  9:35 
And it’s a fact of life; it’s nature of the beast, that real estate agents are not going to go looking for stuff that’s going to make it harder for them to sell their properties. So, that was a bit of disquiet then and then the ad went in (the various official organs), for the new, independent Property Commissioner, to be an employee of Fair Trading. That’s when the Real Estate Institute of New South Wales, Tim McKibbin (who’s the CEO), just blew up at that and said “look, if this is going to be a Fair Trading- run-thing, we’re not in.”

Sue  10:16 
Because it would end up stifled in bureaucracy, probably. It wouldn’t have the same kind of freedom as David Chandler has got, as Building Commissioner.

Jimmy  10:24 
His office is set up by an Act of Parliament, isn’t it?

Sue  10:29 
He is associated with Fair Trading, but I don’t think they’re his bosses. I think he is truly independent.

Jimmy  10:37 
Whereas this Real Estate Commissioner or Property Services Commissioner, was going to be just an adjunct of Fair Trading. And, it shows you the regard in which Fair Trading is held in the property sector, that that was the trigger. So last week, Tim McKibbin announced that the Real Estate Institute of New South Wales will not be part of the Property Services Expert Panel.

Sue  11:06 
Which now makes it absolutely ridiculous; you can’t have it without the real estate agents, really. We would say you can’t have it without the residents of homes, but you know, you certainly can’t have it without the people who are selling them.

Jimmy  11:20 
You don’t have the apartment owners. You don’t have the tenants and now, you don’t have the real estate agents. Chris Duggan, who’s CEO of Strata Community Association (which is the strata manager’s peak body), is hanging in there. I imagine that right now, there’s a lot of behind-the-scenes negotiation going on and they’re saying “come on, Tim; what do you need? What do you want?” It’s not a great start, is it?

Sue  11:51 
No, absolutely not.

Jimmy  11:52 
It does feel a bit like (as he suggested), it was pointless and window dressing, and wasn’t ever going to actually achieve anything.

Sue  12:04 
Absolutely.

Jimmy  12:04 
So yeah, it will be interesting to see how that plays out.

Sue  12:08 
And, in other news from Fair Trading, or Better Regulation and Innovation, I think the the next phase of the apartment buyer protections came in last week, didn’t it?

Jimmy  12:19 
This is basically insisting that all the professionals connected with apartment development, have to register their plans and their projections with the government. I think it’s government, with Fair Trading. So, that it increases transparency and accountability of engineers, architects and builders and I think they kind of have to get approval, as well.

Sue  12:48 
Okay, well, that’s good, so everyone would know what’s going on.

Jimmy  12:50 
Yeah and it means that this information will be accessible to apartment… like, the strata committees and things, when they go back to the developer and say “hang on, you promised us a swimming pool and you’ve given us a fish pond!”  They can go back and say “oh, look, there it says ‘swimming pool'” and they will say “yeah, but it’s for fish to swim in.”  Because, they’re developers.

Sue  13:18 
That’s a good idea, because I remember, when we had our defects problems, it was really hard to get hold of any of the documents. The developers said that they didn’t have them anymore. I mean, why would you destroy documents?

Jimmy  13:33 
And, then when you went back to the architect (who was trying to be helpful), and said to the developer “that’s okay; we’ll get them from the architect,” the developer said “oh, they are copyright, so we don’t give the architect permission to give you…” Do you remember all that? God, they were animals, those people; they absolutely were.

Sue  13:55 
I think you had a call from a lawyer from another state this week, did’nt you, about an apartment building that someone was trying to buy an apartment in. They’d asked to see the plans and the plans of the unit and the developer refused to give them any documentation, whatsoever.

Jimmy  14:09 
Well, what had happened was that this guy had gone to this lawyer and said “I’m thinking of buying this off-the-plan and the lawyer said “well, let me see what they’re proposing.” He did his searches and they didn’t even have a drawing of the building and  there were no floor plans. He went back to the council planning permission…

Sue  14:31 
Authority; Planning Authority.

Jimmy  14:33 
Documents, to see if there was anything there and again, he couldn’t find any floor plan. He said to the potential purchaser “get the developer to give you the floor plan.” So, he went to the developer and the developer said “no, I’m not giving you a floor plan and if you insist, I’m not going to sell you the apartment.”

Sue  14:51 
Wow!

Jimmy  14:52 
And here’s the amazing thing; this block has sold out!

Sue  14:56 
I hope there’s not going to be real problems, in a place like that. You kind of think that there might be.

Jimmy  15:05 
What are the chances?!

Sue  15:06 
In happier news, the Owners Corporation Network have got their strata conference coming up. It has been postponed,  because of the lockdown in Sydney. but that’s happening next month now, isn’t it?

Jimmy  15:19 
It is. so we’ll have the details of that on the website. And, the other thing we’re going to talk about, is the hiding of defects and whistleblowers. We’ll talk about that, after this.

[MUSIC]

Jimmy

Another story that’s come out this week, has been claims that people are hiding the defects in their buildings from potential purchasers, especially, which is a bit illegal. We’ve got a story on the website about how people do that and why they do it. One of the things that has come out of this, is David Chandler is saying that he’s going to expose Owners Corporations that do this; that deliberately hide defects. He hasn’t spelled out how, but he’s going to say they should be worried about this and points out that the building (the notorious building), that was in the papers all last week and last month (where he’s found all these defects), wouldn’t have found out about the defects, if it hadn’t been for a whistleblower. Which brings us to the Strata Matters conference, because you’re going to do a thing about using the media.

Sue  16:36 
That’s right. It’s really hard for Owners Corporations. They (obviously), don’t really want people to know that their building has got defects, because they are worried that the value might fall. I’ll be talking to the conference about how, if you do talk publicly about defects,  it’s probably your best chance to get them sorted out. Then while people might have heard of your building because of defect problems, then they’ll hear even more about your building; the fact that the defects have been fixed up and your value should really increase.

Jimmy  17:10 
It’s funny; we know the way the media works and, for instance, the two buildings near us, they are now known as the anti-pet buildings, because they were very prominent in the news. They tried to ban pets and they couldn’t. You say “oh, I live near the Elan” and they go, ‘oh, is that the anti-pet building?” When we were going through our defects issues (getting back to that), I remember going on TV  and pointing out that a plate of glass had come out of the balcony and landed somewhere. I remember talking to somebody later; years later, and they say “oh, you live in that building, where the person fell off the balcony.”

Sue  17:53 
To their death. with the pet thing, I did a story that was out this weekend in the Domain magazine about pets and apartments and houses. We had a picture of a fantastic greyhound; a huge greyhound that’s being kept by a guy in the Elan now. The greyhound is incredibly happy and its owner is really happy and most people in the Elan I think, are really happy. They’re very affectionate towards James the greyhound.

Jimmy  18:39 
Same name as me, okay.

Sue  18:43 
 So you know, reputations come and they go.

Jimmy  18:47 
Yeah, but there are people in that building who are trying to get the greyhound out, because they say it’s the wrong dog for apartments, which is absolute bullshit, folks! Greyhounds are perfect for apartments

Sue  18:58 
Because they’re so lazy. They don’t want to do anything. They just want to sleep on a couch all day.

Jimmy  19:02 
And if you want somebody to get your rabbits…no, no!

Sue  19:09 
And this week as well, there was the New South Wales Architecture Awards. The Victorian Architecture Awards were a couple of weeks before that. It was interesting; in the New South Wales one, the top award was won by the Newmarket precinct, which is  the first couple of stages of a new masterplanned area in Randwick. The judges were saying really, when architects are now designing apartments, it’s not just about designing good apartments for the residents, although that’s very important. It’s also about providing great places for their neighbors and for the community at large. It’s about building parks, building courtyards. Making apartment buildings kind of meld into the landscape, so other people can enjoy them as well, which I thought was a really interesting view. When you look at the other apartment winners as well, they’ve all got really great areas for visitors, as well and passers-by. People come and play in parks, just nearby and it’s the same for the Victorian ones as well. You know, it’s all about place-making now, which is great. People are taking a larger view.

Jimmy  20:20 
Because there was a bit of a controversy on the telly the other night, about the new development plan for Blackwattle Bay, which is way into the future. But, people were complaining about these 40-storey-high towers. But, because they’ve got the high towers there, it means they’re going to be much more open space, as you can fit more people into the same footprint, kind-of-thing.

Sue  20:45 
Yeah, like McMahons Point. I mean, originally, that was going to be covered with houses and instead, it’s got a couple of (not very good-looking) towers. It just meant that there’s lots more open space.

Jimmy  20:59 
And just going back to the thing about buildings and their reputations… I don’t know if anybody who read the Fin Review this week would have seen us in isolation; a picture of you, Sue, still in your pyjamas at about midday. But the funny thing is that somebody phoned up the editor of that section in the Fin review and said “you’ve got to take that picture out of the paper, because they’ve got a cat in it and they’re not allowed to have cats in that apartment,” which is not true. Cat is totally legal. Slightly over-pedantic, I think and misinformed.

[MUSIC]

Jimmy

It’s NAIDOC Week…

Sue  21:45 
Happy NAIDOC Week,  everyone.

Jimmy  21:46 
And, what’s your news, Sue?

Sue  21:49 
Oh, well, I’ve got a new book out. It’s a biography about a fabulous Aboriginal woman called Aunty Di, who has had an incredible life. She’s kind of had nine lives, in lots of ways. She had a stolen childhood, but she’s ended up overcoming incredible adversity.

I mean, it was just quite amazing to sit with her and hear about her story. she is now one of the most revered and admired elders in the community. She now lives up on the Central Coast. The book is called ‘Daughter of the River Country.’

Jimmy  22:27 
 And who’s publishing it?

Sue  22:28 
It’s Echo Publishing.

Jimmy  22:29 
Right, it’s out now!

Sue  22:30 
It is. It came out on Friday.

Jimmy  22:33 
Is it in all good bookshops?

Sue  22:35 
It is and probably, quite a few bad ones as well!

Jimmy  22:38 
You never miss that joke, do you?! Never miss that one. Well, that’s great. That’s good. I’m sensing, you’re very proud of that?

Sue  22:46 
Yeah, absolutely. I mean, she’s such an amazing woman, Diane O’Brien and it would be great to get a good audience. I mean, it’s a shame that the big launch at the Tramsheds was cancelled. It was meant to be on this Wednesday, but because of the lockdown… Hopefully, it’s going to be postponed, rather than cancelled. Hopefully, we can do it at a later date.

Jimmy  23:06 
And folks, you can find out more about that book on Sue’s website, which is www.sue williams.com.au Thank you again, Sue, for coming in.

Sue  23:18 
Thanks, Jimmy. Thank you for letting me spruik!

Jimmy  23:23 
Spruik your book! And, thank you all for listening.

[MUSIC]

Jimmy

Thanks for listening to the Flat Chat Wrap podcast. You’ll find links to the stories and other references on our website, www.flatchat.com.au And if you haven’t already done so, you can subscribe to this podcast completely free on Apple podcasts, Google podcasts, Spotify, Stitcher, or your favorite pod-catcher. Just search for Flat Chat Wrap with a W, click on subscribe and you’ll get this podcast every week without even trying. Thanks again. Talk to you again next week.

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