Morrison Puts Up Cost of Renovations by 16.6% or $25,000

[tech/a]

Its similar Australia wide.

D/A's are held up mostly in the Planning approval first stage.
Generally understaffed departments who are notorious for
paper shuffling rather than dealing with problems they put
even the smallest issue back on the builder.

I've got no idea why these people have a degree they dont ever use it!

Building approval got to hard they couldn't paper shuffle here so they
out source engineers. Most builders use Private Certification.
Way quicker and much easier to deal with.

 

[frugal.rock]

Most builders use Private Certification.
Way quicker and much easier to deal with.

Reason #3
Just like the relationship you described with tradies aligned to builders, the private certifiers are also aligned.
Some of these "certifiers" have been rubber stamping signatures for hire... however with the cap of 900k?
I can't see too many blocks of units ending up like Pompeii or the leaning tower of Pizza (Pisa, what a !)

Note, if you are going to buy a unit, consider if the area is reclaimed swamp....!
More regulatory protection buying a $10 toaster than a $1 million new apartment...
Structural, design and engineering faults should have something like a 20 year defects liability period, with bank and insurance companies guarantees, IMHO.
F.Rock

 

[tech/a]

Certainly not aware of any private certifications which are Rubber stamped.
I’ve not heard one whisper of any who do.

Sounds conspiracy theory—-ish to me.
Do you have substantiated evidence or
Only hearsay?

I do have evidence of builders NOT using
Materials certified for use in construction.
Happens a lot.
Plus many other examples of not building what
Has been approved

 

[barney]

... small-scale builders ... The one I know have been around a long time and they do a great job.

Same here Aus ..... I know a couple of quality Builders who basically concentrate on doing "small" jobs mainly because most other builders aren't interested .... They have their corner of the market and do very well

some businesses out grow small business.
It happens .We don’t qualify for job seeker. 30 staff fully employed

Any successful small business at some point has to make a decision ... Stay small or go big. Trying to survive the 'in between both' is where difficulties arise. I've been self employed for over 40 years (no helpers; my choice) Currently its a bit tough, but that is more an age and physical condition problem rather than a world economic problem. If only I were 21 again (Or even 50)

Re the thread topic:-

Whether the 25K being offered by Scomo is the best use of funds, I have no idea. I can't afford the additional $150K anyway so it doesn't directly affect me. The fact that the Gov is trying something positive however is a good thing from where I sit.

 

[Beaches]

I am currently doing a $150K reno in Victoria. It is in 3 stages. Stage 1 is 99% complete, just waiting on the plumber.
I rang 5 contractors and was unable to even get a sub-floor contractor to return messages to get a quote or an estimate. The 6th came to quote but was incompetent so I ended up doing the work myself.

The plumber, originally I waited over 2 weeks for the rough in and waited 2 weeks so for the fitout.

There a number of reasons why the average owner builder (home owner) may have trouble getting trades to price and perform work.

First the issue of quoting. When a builder is after a quote from a tradie they will generally issue plans and any other relevant information and the tradie will price the job from the information sent without visiting the site.

When an owner builder is after a quote, the tradie is usually required to take time of work to travel to the site and inspect the job. That’s a considerable commitment for a job they may not get and almost certainly won’t get any repeat work out of.

Second, projects run by people with limited building knowledge.
When a tradie prices a job for a fixed lump sum, they are reliant on the builder’s foreman or site manager to run the project efficiently. If the project is not run efficiently the tradie has to attend site more often and will spend more hours completing the job. Running the project efficiently includes; giving plenty of advanced notice of when the tradie will be required on site; sticking to the dates given: ensuring all other trades carry out their work in the correct sequence; and ensuring the other trades are complete so the tradie can finish their work.

Every tradie has a tale about jobs that have been poorly managed and having to attend site only to find out the job is not ready for their work to start, or they can start but not finish and then having to make a second or third trip. While builders certainly get it wrong, the problem happens a lot more often with owner builders.

Third, the issue of disputes over:
- What is included in the scope of work for the submitted quote.
- What is a legitimate variation which should entitle the subcontractor to extra payment.
- What is a reasonable and acceptable standard of work or finish. Understandably, most owner builders have a very limited knowledge of the Australian Standards for building and the Building Code of Australia (BCA).

The above issues make many tradies somewhat gun shy of working for owner builders if there is other work around. So basically, owner builders have a smaller pool of tradies to work with. On the bright side, as work gets scarcer, there will be more tradies willing to work for owner builders.

Organising the different trades for a building project and getting the work carried out when you need it is not easy. Don’t expect it to be. Builders spend a significant amount of their time planning and organising trades. If it was easy, everyone would be doing it and we wouldn’t have over 50 builders a month going broke in NSW alone.

 

[frugal.rock]

Certainly not aware of any private certifications which are Rubber stamped.
I’ve not heard one whisper of any who do.

Sounds conspiracy theory—-ish to me.
Do you have substantiated evidence or
Only hearsay?

I do have evidence of builders NOT using
Materials certified for use in construction.
Happens a lot.
Plus many other examples of not building what
Has been approved

Not saying it's not a conspiracy theory.... I would like to have worked outside of construction for 30 years rather than in it, though.... in Sydney anyway.
Not saying it's advertised though either... without a good hard sting to catch them, how many people outside the 2 people (builder and certifier) would ever know about it?

As a Surveyor with a weird photographic memory, I've seen enough jobs that weren't inspected.

Sydney's dodgy buildings due to 17 years of inaction.
https://www.smh.com.au/national/nsw...-to-17-years-of-inaction-20181227-p50odo.html

Meritons and Harry T produce some of the better quality buildings. Was actually surprised to them mentioned in the article!
Thankfully I don't personally know any corrupt certifiers. Conflict of interest for me in any case if I did.

Would love to visit Adelaide. Must be nice all round.

F.Rock

 

[Beaches]

Meritons and Harry T produce some of the better quality buildings. Was actually surprised to them mentioned in the article!

F.Rock

I can't recall ever having heard anyone in the industry refer to Meritons as providing the better quality buildings. Although they are not the worst. If you had said Mirvac, then you would have many agree with you.

On the larger projects the problem is not the Private Certifiers. It is not their role and it was never intended that they would inspect all of the works as it proceeded. Their role in the industry is generally poorly understood.

The issues and the solutions for the poor standard of building would fill a library. I wont bore you with them other than to say a significant issue is the lack of accountability of developers when they can start a company specifically to build a project and have no assets in that company to go after if something goes wrong after the project is finished.

There are solutions, but to date our politicians have not had the fortitude to implement them.

 

[Austwide]

@Beaches Thanks for you response, the reasons listed are very valid but the bottom line here is the plumber and the tiler said they were working 7 days a week (not sure how many hours a day) .

The sub-floorguys didn't answer their phone so I assume they were busy as well.

 

[frugal.rock]

So, the age old adage applies, put your prices up to price yourself out of some jobs... and still have enough work for a 7 day week.

 

[Value Hunter]

This whole construction industry stimulus package is small, weak and designed by small minded idiots.

If the government wanted to really boost the construction industry and do something productive the government could have committed to building 150,000 new social housing apartment dwellings over the next 3 years (i.e. 50,000 new apartments a year).

There are probably currently somewhere around 150,000 homeless people in Australia (take the last census figure of
116,427, add in some population growth and then a recent spike due to the current economic crises and you will probably get somewhere around that figure). A country as wealthy as Australia could afford to house them all and it would go a long way towards filling some of the demand gap in the construction industry. Also the government could build some of this housing in regional areas which would create jobs and economic growth in regional areas meanwhile reducing population density/congestion in big cities as some homeless people relocate.

Another thing Australia could do while the construction industry is depressed and traffic levels are down is build a lot more cycleways! England and other countries are taking the opportunity to build more cycle lanes and Australia should too!

Also the Australian government needs to get tough with local councils and beat them with a proverbial baton to cut red tape. When I say a proverbial baton for example that means the government passes emergency Covid 19 legislation changes that gives councils an ultimatum like you have 2 months to significantly stream-line and ease your approvals process and cut red tape by a substantial amount or 50% of all of that councils employees get fired!! Local councils are run by ******* useless twats. They need a proverbial gun pointed at their heads. Local homeowners trying to rennovate the backyard or build a granny flat, etc should not be drowned in red tape. Just by doing this you would see a huge pickup in activity.

Also given that Australia's population is certain to grow over the long-term while the construction industry is depressed the government should take the opportunity to build a massive amount of additional new hospitals (or at least add extensions/facilities to existing hospitals). Over time you will always need more hospitals.

I realize the government has increased its infrastructure investment pipeline but in reality the increase is nothing like what it should be given the situation. I would rather spend stimulus money on building long-term infrastructure than on short-terms cash splashes (which seems to be what the government is focused on) which are largely a waste of taxpayer funds in my opinion.

Unfortunately Australia has been run by short-sighted idiot politicians for a long-time (on both sides) and I do not see that changing any time soon. Absolutely no ability for the government to make long-term decisions in Australia.

 

[Value Hunter]

Another way of stimulating the construction industry would be instead of having a complicated grant scheme why not declare all renovation projects up to a maximum dollar value (say $100,000 for example) tax deductible until the end of this calendar year.

That way many of those homeowners that were putting off renovating their old kitchens, bathrooms, etc due to a lack of cash will bring forward their renovation plans to access the tax deduction. Compared to other solutions its relatively clean, simple to implement and will be available to a wide number homeowners. Importantly it will help a lot of the smaller trade related businesses e.g. the Tiler or plumber or landscaper, etc who has 3 or 4 subcontract/casual employees working for them, etc.

 

[aus_trader]

Another way of stimulating the construction industry would be instead of having a complicated grant scheme why not declare all renovation projects up to a maximum dollar value (say $100,000 for example) tax deductible until the end of this calendar year.

That way many of those homeowners that were putting off renovating their old kitchens, bathrooms, etc due to a lack of cash will bring forward their renovation plans to access the tax deduction. Compared to other solutions its relatively clean, simple to implement and will be available to a wide number homeowners. Importantly it will help a lot of the smaller trade related businesses e.g. the Tiler or plumber or landscaper, etc who has 3 or 4 subcontract/casual employees working for them, etc.

This would have been a much better idea and I would have supported it. Instead it's a very selectively biased short-sighted scheme as I have been discussing all along.

 

[tech/a]

This whole construction industry stimulus package is small, weak and designed by small minded idiots.

If the government wanted to really boost the construction industry and do something productive the government could have committed to building 150,000 new social housing apartment dwellings over the next 3 years (i.e. 50,000 new apartments a year).

There are probably currently somewhere around 150,000 homeless people in Australia (take the last census figure of
116,427, add in some population growth and then a recent spike due to the current economic crises and you will probably get somewhere around that figure). A country as wealthy as Australia could afford to house them all and it would go a long way towards filling some of the demand gap in the construction industry. Also the government could build some of this housing in regional areas which would create jobs and economic growth in regional areas meanwhile reducing population density/congestion in big cities as some homeless people relocate.

Another thing Australia could do while the construction industry is depressed and traffic levels are down is build a lot more cycleways! England and other countries are taking the opportunity to build more cycle lanes and Australia should too!

Also the Australian government needs to get tough with local councils and beat them with a proverbial baton to cut red tape. When I say a proverbial baton for example that means the government passes emergency Covid 19 legislation changes that gives councils an ultimatum like you have 2 months to significantly stream-line and ease your approvals process and cut red tape by a substantial amount or 50% of all of that councils employees get fired!! Local councils are run by ******* useless twats. They need a proverbial gun pointed at their heads. Local homeowners trying to rennovate the backyard or build a granny flat, etc should not be drowned in red tape. Just by doing this you would see a huge pickup in activity.

Also given that Australia's population is certain to grow over the long-term while the construction industry is depressed the government should take the opportunity to build a massive amount of additional new hospitals (or at least add extensions/facilities to existing hospitals). Over time you will always need more hospitals.

I realize the government has increased its infrastructure investment pipeline but in reality the increase is nothing like what it should be given the situation. I would rather spend stimulus money on building long-term infrastructure than on short-terms cash splashes (which seems to be what the government is focused on) which are largely a waste of taxpayer funds in my opinion.

Unfortunately Australia has been run by short-sighted idiot politicians for a long-time (on both sides) and I do not see that changing any time soon. Absolutely no ability for the government to make long-term decisions in Australia.

Some great points here VH

In particular Councils and Red Tape.
It’s never changed in the 40 years I’ve been in
The building industry.
I also love your tax deduction idea.

The unfortunate thing is that if you were in
Politics it would take 10 years of argument
Investigation and feasibility studies to be
In a position to place it on the table!!

 

[Garpal Gumnut]

Another way of stimulating the construction industry would be instead of having a complicated grant scheme why not declare all renovation projects up to a maximum dollar value (say $100,000 for example) tax deductible until the end of this calendar year.

That way many of those homeowners that were putting off renovating their old kitchens, bathrooms, etc due to a lack of cash will bring forward their renovation plans to access the tax deduction. Compared to other solutions its relatively clean, simple to implement and will be available to a wide number homeowners. Importantly it will help a lot of the smaller trade related businesses e.g. the Tiler or plumber or landscaper, etc who has 3 or 4 subcontract/casual employees working for them, etc.

What a great idea.

Treasury might be against it.

gg

 

[Austwide]

Another way of stimulating the construction industry would be instead of having a complicated grant scheme why not declare all renovation projects up to a maximum dollar value (say $100,000 for example) tax deductible until the end of this calendar year.

Some of the funding for the loss in taxes would be everyone wanting receipts and cutting out the removal of GST from the bill for cash payments done by some small scale contractors.

 

[Value Hunter]

Austwide you are absolutely correct. The scheme would cost far less than people think because most of the cash jobs would temporarily disappear and tradies won't complain too much about paying extra tax under a scheme like that in the current environment because at least they will be getting work! Better to have a lot of work and pay some tax then to have very little work! When a cash job turns into a fully legal job, as you said GST will be paid, plus income tax on the wages of any employees employed by tradespeople plus if its a building company in a PTY LTD structure corporate taxes on profits will also be paid. That is not even counting all the taxes paid throughout the supply chain for building materials purchased, etc.

Also creating extra jobs due to increased demand for construction services means fewer people on jobseeker/centrelink.

I think once you factor in all of the above the cost to the tax payer would be relatively modest.