Incoming NSW government urged to continue war against building defects

The industry body for the state’s strata sector highlighted that it is “vital” for the elected leaders in the wake of the 25 March poll, particularly those who will take the mantle from building commissioner David Chandler, to commit to the “strengthening and continuation of key property and building industry reforms”. 

Appointed to lead the Office of the NSW Building Commissioner (OBC) in August 2019 by the incumbent Perrottet government, Mr Chandler has pushed for several initiatives and implemented the state’s government’s building reforms to combat building defects.

Some of these initiatives include implementing the Design and Building Practitioners Act 2020, introducing the Building Stronger Foundations reforms, establishing a Building and Construction Industry Leadership Group, and introducing the Digital Building Verification System. 

The Strata Community Association (SCA) stressed that with Mascot Towers continuing to make headlines for “all the wrong reasons” and Jean Nassif’s property development company Toplace being at the epicentre of “numerous complaints” regarding building defects, the incoming government should not lose sight of the key property and building industry policy reform projects that have been laid out. 

For context, residents of the Mascot Towers apartment complex in Sydney were evacuated in June 2019 due to concerns over cracking and subsidence in the building’s foundation.

The 132-unit building completed in 2018 was found to have significant structural damage, including cracks in the walls and beams, and subsidence in the foundation, which ultimately rendered the building uninhabitable. 

Notably, the incident sparked widespread concern about building defects and safety in the construction industry in Australia and led to calls for greater regulation and oversight to ensure that buildings are safe and compliant with construction standards. 

The Mascot Towers incident also prompted the NSW government to introduce new building reforms as well as the establishment of the Building Commissioner to improve the quality and safety of construction practices in the state.

Meanwhile, developer Toplace has been the subject of investigations by various regulatory bodies, including the NSW Building Commissioner, due to allegations of poor construction practices, including the use of substandard materials, poor workmanship, and inadequate quality control measures that have led to significant defects in their buildings.

Stephen Brell, the president of SCA (NSW), said the strata industry is seeking reassurance from the new government, whether it be under the leadership of current Premier Dominic Perrottet or Opposition’s Chris Minns, that they will maintain ongoing, specifically tailored programs and initiatives.

He said that such a pledge is required to ensure that consumer confidence is restored in both the strata schemes and the broader property sector.

“SCA (NSW) has been working hand-in-glove with David Chandler and the Office of the Building Commissioner (OBC) on a number of key issues within the sector and we need to see that work continue with a renewed focus, commitment and investment by the incoming government,” Mr Brell said. 

He also warned that the NSW residential apartment sector is at risk if the newly formed government forgoes continuing the work of the OBC to rectify building defects and strengthen consumer protections for the millions of NSW residents living in strata buildings. 

“SCA (NSW) and its members strongly believe in the value and importance of the building and property sector reforms currently underway in NSW, and together we urge any future government to commit to the timely implementation of these critical, landmark, and necessary changes,” he said. 

The executive cited a recent survey of 1,400 conducted by SCA (NSW) and the OBC, which showed more than one-third (39 per cent) of new strata buildings have serious defects representing an average cost of approximately $331,829 per building.

“NSW leads the way in the trend of higher density living, with apartments accounting for more than half of all new dwellings expected to be built by 2032,” Mr Brell added.

“With more than 50 per cent of the NSW population estimated to live and work in strata schemes by 2040, he underlined that it is “vital that we have an industry that is trusted and accountable.”

As electric vehicles (EV) become more popular in NSW, the SCA also called on the parties to focus on initiatives that will further its widespread adoption while ensuring that safety protocols are in place.

Key areas raised by the body include the emergency services levy (ESL), EV integration and safety in strata buildings. 

ESL is a payment that helps fund certain emergency services in NSW.  

According to Mr Brell, ESL is an important issue because NSW is the only mainland state that funds its emergency services through a tax on insurance. 

This is due to the imposition of the ESL as a tax on insurance, which has resulted in an 18 per cent annual increase in premiums.

Furthermore, he highlighted that with the exponential rise in the cost of living, strata owners are unfairly bearing the brunt of funding emergency services.

“Emergency services are a critical part of our community but they must be funded in a way that doesn’t unfairly punish strata residents who are required to purchase compulsory strata insurance,” Mr Brell said.

With one in five residents living in some form of strata-titled property, he pointed out that a significant number of EVs will be occupying strata parking structures. 

On that note, the SCA (NSW) has expressed their worries about the safety risks associated with the rapid growth of EVs in strata, due to the known fact that EV battery cells can fail, which may lead to the release of hazardous substances, such as toxic and flammable gases and vapours, difficult-to-extinguish fires, thermal runaway effects, and leaks of dangerous materials.

“While we welcomed the commitment of the Perrottet government towards co-funding medium and large apartment buildings with EV charging in the 2022–23 state budget, we want to see a thorough investigation into the additional safety considerations and requirements ahead of the widespread integration of electric vehicles into strata homes,” Mr Brell concluded.