Sydney buyers abandon off-the-plan units for houses after building disasters
Some Sydney buyers ‘spooked’ by the horror stories of Mascot and Opal towers are abandoning off-the-plan apartments for house-and-land packages, according to a major builder.
NSW
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One of the NSW bosses of Australia’s largest home builder says “nervous as hell” buyers are abandoning off-the-plan apartments in Sydney and opting for a house and land package for a similar price.
Metricon’s NSW general manager Luke Fryer said interest in houses had increased by around 25 per cent over the past eight weeks amid a massive blow to consumer confidence after the evacuations of the cracked Mascot Towers. That followed the earlier emptying of Opal Tower in Sydney Olympic Park after cracks were discovered late last year.
It was also revealed this week that residents from 30 units at 19 Gadigal Ave in Zetland were evacuated last year when the decade-old building suffered severe water damage.
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“I really hope what we’re looking at here is in isolation, but, as it stands in Sydney, people are terrified to enter into an apartment purchase unless there’s a whole heap of certainty provided,” Mr Fryer said.
“There’s no doubt they’re nervous as hell — it’s only natural.”
Mr Fryer also said there was only a “marginal” gap between the cost of houses and apartments in some parts of Sydney, such as the northwest.
“At Castle Hill around Castle Towers you might spend $1 million on an apartment, but you can get a brand new home and land on a 540sq m block in Kellyville for $1.1 million,” he said.
Metricon also provides a lifetime structural guarantee on all new home builds, whereas there is only a six-year warranty for major building defects on most NSW apartments.
A spokeswoman for Meriton, the nation’s largest apartment developer, said the string of apartment issues had “no impact” on business “at all”. But she said engineers should be checked on their designs by an independent engineer “like in Victoria where the private certifiers are required to do so”.
Lendlease did not respond specifically to questions regarding whether it had noticed customers being turned off apartments, but a spokesman said the company has a “strong track record” in developing and constructing residential properties.
Mirvac and Multiplex declined to comment.
Property Council chief executive Ken Morrison said people “should have the confidence to buy” as Australia boasts some of the best national building codes and builders in the world. But while the codes are “stringent” he said their application by state governments has been “very inconsistent”.
And he warned a failure to act on reforms was “hurting public confidence”.