There are two strata properties in Perth that were completed within the last three years that host a large number of substandard workmanship and material defects that are no longer covered by the Builder. In these two circumstances the cost of the repairs has fallen directly onto the Owners to rectify, leaving one couple homeless as their property was deemed uninhabitable. One building defect alone is going to cost the Owners in excess of $700,000.00. The reality of such situations is that Owners and investors can find themselves unable to lease, sell or insure their properties. These situations are rare, however may become increasingly more common if more companies go into administration.
‘Research shows that about 52% of apartment owners in WA have had or are experiencing defects.’ Sam Reece, WAAA
So where does this leave you if you are the owner of a lot that has been completed within the last few years and your builder is no longer trading?
Every situation is different however, assuming that no defect reports have been completed to date, the initial requirement will be engaging a qualified building inspector to inspect the common property and provide a detailed defects report. An asset register should also be obtained as the Strata Manager will now be acting on behalf of the Owners in managing repairs and maintaining assets.
The report that you will require if you find yourself managing and financing the building defects is similar to a Ten Year Plan however the inspector will work with you to ensure that your budgetary requirements can afford the repairs and he will match your available funds with the seriousness of the defect and the subsequent damage it may cause to the remaining building structure if not rectified.
It is important to note that some building materials may come with their own warranty of 10 – 15 years. If a defect is identified as a materials fault then Owners may take this back to the manufacturer for compensation if the Builder is no longer solvent.
The initial BCI assessment will identify;
- If the building and materials are performing as they were intended to.
- If the building element complies with the Building Code of Australia or falls within the Standards and Tolerances.
The report that you will require if you find yourself managing and financing the building defects is similar to a Ten Year Plan however the inspector will work with you to ensure that your budgetary requirements can afford the repairs and he will match your available funds with the seriousness of the defect and the subsequent damage it may cause to the remaining building structure if not rectified.
Every defect will be identified with a description, priority, location, cause, recommended tradesperson and suggested rectification.
The most common defects include:
- Moisture ingress i.e. roof top leaks or inadequate run offs
- Incorrectly installed window frames
- Cracking on internal or external walls
- Rising damp from pooling around building perimeter
- Substandard workmanship and materials.
The inspector will determine if it is a design fault, material issue, or poor workmanship.
The best advice for all Owners is to have a Defects Report completed while the builder is still solvent so repairs can be addressed at their expense. It is an uncertain economy and it is impossible to know how long a company may remain trading.
BCI WA inspectors have been inspecting strata properties for 26 years in Perth. We offer practical, independent advice and explain defects so Owners can understand the condition of their property and agree on an optimal maintenance strategy.
Builder’s Liability Reports
Defects Reports
Ten Year Plans
Asbestos Registry and Management Plans
Maintenance Reports
Dilapidation Reports
Moisture Ingress Reports
Pre-purchase Inspection Reports
For further information feel free to contact us at BCI WA.
