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Peter Rogozik Property Consulting

Buying brand new – beware!

Before purchasing a brand new property, buyers should always research what materials, products, fixtures and fittings have been used during construction. It is not enough to rely on the building drawings or even the specification document.

A case in point is the cladding fiasco that has cast a shadow over the Victorian building industry. After construction drawings were approved some of Melbourne’s leading builders and developers were disregarding the approved specification and sourcing cheaper alternatives overseas.

Melbourne’s fast expanding population has unearthed a band of property developers whose primary aim is to make money; this means quality of construction plays a distant second to the bottom line.

The business model is simple. Build them cheaply as possible with sub-standard materials sourced overseas. Use cheap unskilled labour where possible. Operate each project under a different shelf company to protect the building company directors. Liquidate the company on completion of the project to avoid any liability.

During construction of residential dwellings there is unlikely to be independent quality control. Building surveyors are on site less than one percent of the construction time frame. A building surveyor will only check that basic construction codes are followed.They don’t have the detailed level of knowledge to check building structural designs, fire safety systems, mechanical and electrical plans and so on.

They don’t check if waterproof membranes were applied correctly, if concrete was cured to the correct Mpa strength. On most occasions they don’t check that the materials specified were used during construction.The onus is on the buyer to make the necessary checks before signing on the dotted line.

Eighty per cent of building faults relate to water flow and waterproofing failures so buyers would be well advised to focus on these issues.

Before buying a brand new property the following are some practical tips that may reduce risk;

• Speak to buyers of the developer’s previous developments and ask if they were happy with how the developer responded when building defects were reported.
• When buying off the plan engage an independent building consultant to check each stage of construction.
• Does the building comply with the National Construction Code in relation to fire safety?
• Obtain material safety data sheets when in doubt to ascertain if a material or product complies with an Australian standard or where appropriate has a conforming fire rating.
• Ask the builder for a warranty guaranteeing the performance of all waterproof membranes in wet areas and balconies for 10 years and that the membrane has been applied according to Australian Standard AS3740.
• Check there is sufficient fall to drains in all areas subject to water flow e.g. roof, roof guttering,balconies, ground surface drainage, shower and bath.
• During your pre-settlement inspection measure to check that the floor plan matches your contract.You may also want to record the measurements for future reference, such as for furniture selection.

Here in Victoria it is mandatory for a residential builder to take out domestic building insurance.This gives buyers some level of protection.However it is a much easier road to complete all the necessary checks before signing on the dotted line rather than having to pursue the builder through the legal system.

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