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The future of Australian property prices

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Belli said:
I don't normally react to sob stories, however this is one where I do have a high level of sympathy for those impacted. They have been left to hang out to dry and it's wrong. Although it is Sydney-centric, I have no doubt essentially zilch adherence building standards and construction applies in other areas including Canberra. I have heard some terrible about construction issues in this neck of the woods including new builds. I honestly do not know the solution to rectification of the defects in places which are now uninhabitable. Normally, and understandably, we as a group do not like digging into our own back pockets to bail these individuals out but it may come to that if the State & Territory Governments face up to the reality they have completely failed these people.

www.abc.net.au

The game of 'Russian roulette' facing Sydney apartment buyers

As the NSW government pushes for more housing density in Sydney, questions about the quality of new apartment buildings have re-emerged after major developer Toplace went into administration.
www.abc.net.au www.abc.net.au
Click to expand...

One of the things wrong with the system.

www.abc.net.au

When Erika offered $700k for a home, she didn't know it was 'better suited to demolition'

Erika Vlasic received two reports about a home she wanted to buy. She said one came back with "no big issues", and the other found the property was suited to "demolition".
www.abc.net.au www.abc.net.au
 
SirRumpole said:
One of the things wrong with the system.

www.abc.net.au

When Erika offered $700k for a home, she didn't know it was 'better suited to demolition'

Erika Vlasic received two reports about a home she wanted to buy. She said one came back with "no big issues", and the other found the property was suited to "demolition".
www.abc.net.au www.abc.net.au
Click to expand...
You only have to venture down to Bunnings on the weekend and see people that are incapable of parking a car, packed to the hilt with renovation goods.
 
SirRumpole said:
One of the things wrong with the system.

www.abc.net.au

When Erika offered $700k for a home, she didn't know it was 'better suited to demolition'

Erika Vlasic received two reports about a home she wanted to buy. She said one came back with "no big issues", and the other found the property was suited to "demolition".
www.abc.net.au www.abc.net.au
Click to expand...
I see two sides to this.

On one hand there are problems with the system as it stands that's undeniable.

On the other hand:

Among other defects, building inspector Mike Heathcote had found some areas of the house were assumed to contain asbestos, while others were prone to mould growth and conducive to termite activity,
Click to expand...

Well sure, any house built prior to 1990 will be assumed to contain asbestos, a very large portion are prone to mould if the occupant does things to create it and any house containing timber is at some risk of termites anywhere on mainland Australia.

There are issues sure but those particular ones aren't unexpected or abnormal. :2twocents
 
Belli said:
There are more rights and protections when buying at $20 toaster than purchasing a home for $1m it seems. That imbalance is obscene.
Click to expand...
Well regulation would just slow down the sales, right? Can't have someone like Mike Heathcote finding all these issues.

/end sarcasm

I do find it mind boggling that even for those regulations that havent been rolled back, that the rules dont seem to be enforced. If they were, how could so many shoddy buildings be causing so many issues? Builders aren't incentivized to follow the regulations or stick to high standards. It's a churn of properties and quick sales, quick renos, to cash in on the market. I see both gov and private have a hand to play in that. Not saying all tradies are like that either as I know some definitely have high standards of their craftsmanship, but I'm sure those ones are quickly pushed out the door for someone who will cut corners, save on material costs, and pump out a greater number of jobs.

Stories like this make me even more cynical on entering the real estate market lol
 
Warr87 said:
Not saying all tradies are like that either as I know some definitely have high standards of their craftsmanship, but I'm sure those ones are quickly pushed out the door for someone who will cut corners, save on material costs, and pump out a greater number of jobs.
Click to expand...
That's the problem.

Not all but a large portion of trades work is on the basis that the customer is demanding the cheapest. That's to the point that many tradies automatically assume that's what the customer is after, that lowest price gets the job, unless specifically stated otherwise.

I had some plumbing work done about 4 years ago and long story short, the plumber just about fell over when I said how I wanted it done. I wanted it done optimally not cheaply. :2twocents
 
Smurf1976 said:
Not all but a large portion of trades work is on the basis that the customer is demanding the cheapest. That's to the point that many tradies automatically assume that's what the customer is after, that lowest price gets the job, unless specifically stated otherwise.
Click to expand...
Surely that is where building standards should come in ?

Most consumers don't know what they are looking at so it's up to experts to tell them.

Cheapest price that conforms to the standards is fine, which implies that inspections must be honest and not corrupt and that builders who fall below standards should not be in the business.

Is that too idealistic ?
 
SirRumpole said:
Surely that is where building standards should come in ?

Most consumers don't know what they are looking at so it's up to experts to tell them.

Cheapest price that conforms to the standards is fine, which implies that inspections must be honest and not corrupt and that builders who fall below standards should not be in the business.

Is that too idealistic ?
Click to expand...

I tend to agree with you @SirRumpole.

I know little to nothing about building issues. When we bought this place there was an obvious visual defect. A brick pillar was leaning outwards. An inspection revealed a beam which rested on that pillar had warped. Rectification would involve replacing part of the beam and also dismantling then rebuilding the pillar. Not repairing meant there was a possibility it would fall bringing down other parts of the external wall. Insurance wouldn't have covered it as it was a known defect which should have been repaired. Despite strong resistance from the vendors they finally agreed to reduce the selling price by $20k (they had to really as the place had been on the market for seven months and no takers at the price they were asking.) Repair cost me $16k.

The point of that tale is those who certify or inspect construction stages of buildings have to be prepared to say "Nup, ain't good enough." Of course there is corruption to some extent but that applies to all occupations. It also leads to the issue of private or Government employed certifiers but the latter means public servants and you know how the population feels about them. However, the PwC saga should give people pause for thought on that aspect.
 
Belli said:
I tend to agree with you @SirRumpole.

I know little to nothing about building issues. When we bought this place there was an obvious visual defect. A brick pillar was leaning outwards. An inspection revealed a beam which rested on that pillar had warped. Rectification would involve replacing part of the beam and also dismantling then rebuilding the pillar. Not repairing meant there was a possibility it would fall bringing down other parts of the external wall. Insurance wouldn't have covered it as it was a known defect which should have been repaired. Despite strong resistance from the vendors they finally agreed to reduce the selling price by $20k (they had to really as the place had been on the market for seven months and no takers at the price they were asking.) Repair cost me $16k.

The point of that tale is those who certify or inspect construction stages of buildings have to be prepared to say "Nup, ain't good enough." Of course there is corruption to some extent but that applies to all occupations. It also leads to the issue of private or Government employed certifiers but the latter means public servants and you know how the population feels about them. However, the PwC saga should give people pause for thought on that aspect.
Click to expand...

Well, if the private enterprise system of building inspectors has failed, then why not go back to government employed ones ?

Not being ideological, but just looking at results. It's crazy to continue with a flawed system.
 
Smurf1976 said:
That's the problem.

Not all but a large portion of trades work is on the basis that the customer is demanding the cheapest. That's to the point that many tradies automatically assume that's what the customer is after, that lowest price gets the job, unless specifically stated otherwise.

I had some plumbing work done about 4 years ago and long story short, the plumber just about fell over when I said how I wanted it done. I wanted it done optimally not cheaply. :2twocents
Click to expand...
We had a second floor built on our house, to cut a long story short as you say, if I hadn't been retired and on site 24/7 it would have been a disaster.
We used a large well known company that specialises in building houses and home additions, they are still in business today. When the work was being carried out, several serious issues would have been covered up or completely left out if I hadn't been there and demanded they were rectified, some were structural.
With regard your comment about price, the contract cost was high, what the company was paying the subcontractors was extremely low.
An example, the master bedroom ensuite which consisted of, walk in shower, twin hand basin area and seperate toilet section, whole thing being about 4m x 2m.
The tiler left his apprentice to do the work and I was concerned he was having difficulty getting the falls correct to the floor wastes, so when the boss arrived I mentioned he should probably stay and oversee the work, he said he was getting paid $90 to screed the whole floor including supplying the materials he couldn't afford to stay.
When that was completed another subbie arrives to apply the waterproof membrane and the building company hadn't supplied enough 50x50 plastic angle to place where the floor meets the bathroom wall, answer it will be ok the tiles cover it, meanwhile I head off to Bunnings to buy the extra needed.
A three meter lintel stiffener required fixing to a lintel above the window on the lower floor, because it was supporting a corner of the upper floor, it never arrived when I asked if it was going to be installed, they said the engineers decided against it, so I said I want that in writing end of story, the stiffener was installed after the upper floor was complete.
Even that was a fiasco, welder arrives with said beam and asks me where is this going, I say above that window. So off comes the tin to expose the lintel in goes the stiffener and out comes the welder. I say hang on aren't you going to take the weight off the window first before welding it on, or the window will keep rattling from the vibrations of people walking upstairs, so he says ok how do we do that, I end up being his supervisor.
The whole show was just a joke, but it highlighted to me that no one gives a $ht so if you are getting it done, you had better hang about IMO.
The whole build was like that, a subbie would arrive to do a job the build wasn't at the stage he was required, he would say well I'm doing it anyway they will just have to work around it, the whole process was a fiasco and I dread to think what is being built that is nothing like what the owner thinks.
My tips, make sure everything is in the contract and be on site e.g the stairs cupboard was meant to be brick to reduce noise from downstairs(kids), they start using timber and say if it isn't on the drawing it's timber, I show them the contract. The bathroom vents, they were going to vent to eaves, i showed them the contract it said three roof vents.
What's the old saying? A coat of paint covers a myriad of sins.
 
Last edited:
The whole system is broken and needs an overhaul. Property prices in Australia are ridiculous, buying in the country was once value for money. those days seem to be gone.

A few months ago, I decided to test the system in a coastal town that I visit every fortnight. There are a group of low-quality blocks with some limited marina views, one side are 400sqm which have blocks in front which will affect views when built on, and on one side there are 600sqm with better views of the marina and nothing can be built in front. All the blocks were purchased by private individuals about 15 years from the marina developers, at very reasonable prices. Most of the owners sat on them as investments. Occasionally a block goes up for sale multiple times, but no building has happened until recently. I 've been watching the area for quite a while now and have become interested in how the sales happen, and the pricing. Some of those blocks have been sold several times, and each time the profit margin increases substantially.

In that group, there is never more than 2 blocks up for sale at a time. And when one sells, another comes up for sale. One block went up for sale at Christmas time for $220,000 (previously sold 12 months prior for $138,000), a month later the owner of the block in front started building a two-story home. there goes the view.

Time for some research and fun. Eight weeks ago, I sent a low-ball offer to the agent selling, he contacted me and said that "the block is already under offer at a much higher price. We have another property with a better view for sale". I asked, "why isn't this information on the web site, shouldn't it be listed as under offer?" And he says "Just waiting on finance approval".

Five weeks later and the block of land is still listed as For Sale. So I send in another offer, slightly higher than the first but still pretty low. The agent contacts me and says, 'sold for higher than your offer, but we have another property with a better view for sale'. I ask, "why is this information not on Realestate.com.au, it still shows for sale". And the agent said, "the bank has just approved funding this morning".

Three weeks go by, and the land is still listed for sale. I again contact the agent, and ask "what is going on, why isn't there 'under offer' or 'sold' on the listing? I want my offer given directly to the owner". The agent assures me that it is 'sold, just been waiting on finance approval. We have another property with a better view for sale'.

The next morning the web site shows that the property is SOLD.

Gaming the system?
 
Smurf1976 said:
That's the problem.

Not all but a large portion of trades work is on the basis that the customer is demanding the cheapest. That's to the point that many tradies automatically assume that's what the customer is after, that lowest price gets the job, unless specifically stated otherwise.

I had some plumbing work done about 4 years ago and long story short, the plumber just about fell over when I said how I wanted it done. I wanted it done optimally not cheaply. :2twocents
Click to expand...
do not assume that crappy job is cheaper..
As a rule of thumb based on experiences in the last 5 years or so:
after asking some quotes and discussing jobs, from plumber, electrician to earthmoving:
->I would say a good half of these tradies I met in my opinion should not even be entitled to work/workas they do, as i expect better from a professional with proper equipment/toolbox than a weekend warrior,
and my surprise is that the cheapest are not the worst, not at all;
It is very difficult in this country, not sure elsewhere ?to find a proper responsible competent tradie if you do not have a good word of mouth recommendations,
And even so, I rely mostly from the recommendation of a former neighbour of mine, painter, who I fully trust and knows enough tradies.
This is an issue for the quality of buildings, their livability and longevity,but it also affects the overall cost of housing which is beyond belief considering the type of building being built in australia:
american style cheaper cladding, veneer and fibro on matchstick frames at the price of besser block and double brick in other countries...
I understand that mesh are strong and resilient but still subject to full collapse if a failure occurs in one of these links/junctions.
 
SirRumpole said:
Surely that is where building standards should come in ?

Most consumers don't know what they are looking at so it's up to experts to tell them.

Cheapest price that conforms to the standards is fine, which implies that inspections must be honest and not corrupt and that builders who fall below standards should not be in the business.

Is that too idealistic ?
Click to expand...

Idealistic, but is supposed to be how it's done IMO. Experts are meant to provide advice. And 100%, the cheapest should still be conforming to standard.

SirRumpole said:
Well, if the private enterprise system of building inspectors has failed, then why not go back to government employed ones ?

Not being ideological, but just looking at results. It's crazy to continue with a flawed system.
Click to expand...

I also agree with this too! Though someone would accuse it of being a commy/socialist move to have gov interfere and over-reach with regulation. And from that, reform is done and dusted, never to get off the ground. Unless messaging was strong from the get-go on how beneficial having those standards are for everyone, it'd get torpedoed by a lot of ppl (particularly developer groups).
 
qldfrog said:
do not assume that crappy job is cheaper..
As a rule of thumb based on experiences in the last 5 years or so:
after asking some quotes and discussing jobs, from plumber, electrician to earthmoving:
->I would say a good half of these tradies I met in my opinion should not even be entitled to work/workas they do, as i expect better from a professional with proper equipment/toolbox than a weekend warrior,
and my surprise is that the cheapest are not the worst, not at all;
It is very difficult in this country, not sure elsewhere ?to find a proper responsible competent tradie if you do not have a good word of mouth recommendations,
And even so, I rely mostly from the recommendation of a former neighbour of mine, painter, who I fully trust and knows enough tradies.
This is an issue for the quality of buildings, their livability and longevity,but it also affects the overall cost of housing which is beyond belief considering the type of building being built in australia:
american style cheaper cladding, veneer and fibro on matchstick frames at the price of besser block and double brick in other countries...
I understand that mesh are strong and resilient but still subject to full collapse if a failure occurs in one of these links/junctions.
Click to expand...
I was actually watching a bodgy job this morning, the house next door had a cheap second storey put on, it is a rental and the upper floor has leaked badly into the lower floor since it was put on.
Well it will be interesting to see if it goes on the market soon, a handy man was removing about 100 or so tiles and putting sisal under the battens, from the upper floor wall flashing down to the gutter, then the tiles were put back on.
So that fix wont last long, but maybe it doesn't have to. ;)
 
Warr87 said:
I also agree with this too! Though someone would accuse it of being a commy/socialist move to have gov interfere and over-reach with regulation. And from that, reform is done and dusted, never to get off the ground. Unless messaging was strong from the get-go on how beneficial having those standards are for everyone, it'd get torpedoed by a lot of ppl (particularly developer groups).
Click to expand...
Just need some really high profile media personality to get seriously ripped off, by a dodgy building company, then it would get some air play.?
 

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