Opal, Mascot towers fallout: Warning of building industry crash

A strata lawyer has warned that sales for new apartments will crash unless the State Government urgently puts in place greater protections for homeowners.

• Opal Tower owners at breaking point over tainted units
• Mascot owners slugged with $1m levy for 'urgent repairs'
• Govt vows to crack down on dodgy construction

The State Government must deliver urgent protections for homeowners or face the collapse of Sydney’s building industry, a strata lawyer has warned.

Owners Corporations Network chair Stephen Goddard says the government has been addicted to the stamp-duty “sugar hit” in the burgeoning property market — but failed to deliver the necessary consumer protections.

“How’s it possible that successive parliaments can do so little for so many, for so long?” Mr Goddard said.

“Successive governments have been on a sugar hit; they need the building industry and its stimulus to the economy to deliver the stamp-duty bonanza.”

Mascot Tower residents were evacuated after cracks appeared in the building.

Residents being evacuated from the Opal Tower in a 2018 nightmare.

His comments come as owners face financial ruin in the wake of building debacles at Sydney Olympic Park and Mascot in the past six months.

“What’s happened with the terrible events at Opal and Mascot towers is that we’ve pulled the skin off the custard and the consequences of government wanting the sugar hit from the building industry and not discharging its duty to the community,” Mr Goddard said.

“I am of the view that until the government does something, in the form of consumer protection, a prudent purchaser would not buy an apartment off the plan and they wouldn’t buy into a building less than 10 years old.

“This would do immense damage to the industry.”

He believes the “toxic” reputations of the Opal and Mascot towers may never recover.

Stephen Goddard has issued a dire warning for the building industry unless reforms are urgently put in place. Picture: John Feder

“They no longer have any value to protect owners and their mortgages,” Mr Goddard said.

The Opal Tower owners’ corporation chair, Shady Eskander, highlighted a glaring disparity of consumer rights in NSW.

“You buy a strawberry and if there is a needle in it, the entire supply source will be thrown out. The government will demand the growers start again with new trees and gardens,” he said.

“So that’s when you buy a $5 punnet of strawberries. But if you go and put your whole life savings into an apartment, you’ve got zero protection.

“You might as well declare yourself bankrupt if something were to go wrong.”

Latest figures show apartments account for about a third of all homes in Sydney.

The needle strawberries bought at a supermarket last year.

Shady Eskander.

The NSW Government is set to legislate an industry-wide “duty of care” to homeowners and owners’ corporations so that they have the right to compensation where a building practitioner has been negligent.

It is also set to appoint a Building Commissioner, who will act as a consolidated regulator for the industry.

Other reforms will require building designers, including engineers, to declare that developments comply with the Australian Building Code, and builders and designers will need to be registered.

Fair Trading Minister Kevin Anderson is expected to make an announcement soon on these reforms.