Crackdown on real estate agents and developers proposed, more detail on tower sales required
Gold Coasters are calling for off-the-plan unit sales to be banned as a leading real estate agent backs a push to crack down on the property industry.
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A leading real estate agent has thrown their weight behind a crackdown on the property industry to force developers to “tell the truth”.
The Bulletin last week revealed The council wants the Office of Fair Trading (OFT) to reform rules that allows developers to sell apartments without having to advertise if the project has received council approval.
More than $70m of units have been sold in four high-profile developments rejected by City Hall in the past year.
he said.
In separate examples, people have been left without a roof over their head after selling their properties to buy units in failed projects.
Veteran agent Lucy Cole has come out in favour of the proposal.
“Selling apartments off the plan when they don’t have approval and the buyers are not aware is not a good look for the agents, the developers or the Gold Coast at large,’’ she said.
“For most people, purchasing a property is one of the biggest purchase decision that they will ever make in their lives, so there is a lot at stake for them.
“I can only imagine how much emotional pain a buyer would feel if they signed up to buy a property only to discover the building did not gain approval and is not going ahead.
“The buyers in many cases like these lose time, energy and money.
Bulletin readers also backed the move.
Greg wrote: “I have been professionally involved in the development industry for over 50 years and can’t understand why people buy off the plan. It ends in pain more often than not.”
Muso wrote: “There needs to be more regulation regarding real estate and developer marketing agent conduct, particularly selling developments not yet built.”
“It should be unlawful for developers to sell and take purchaser deposits before the plans are actually approved by Council. This recent practice is unethical and deceitful,” they wrote.
“It’s not ‘buying off the plan’ when the plan is not even approved!
“Developers and their agents are selling air and a dream in these cases. At the moment it’s up to the buyer beware & due diligence.”
Buyers coughed up more than $65m for a bed in the controversial $100m, 29-story La Mer tower proposed for Main Beach, before it was knocked back by the council in December 2021.
In February, council shot down Melbourne-based developer Little Projects Co’s proposed $73m Broadbeach tower Aperture.
Overlooking Broadbeach State School, its units had already been placed on the market with prices ranging from $2m to more than $7.7m.
The developers of both projects have appealed the decisions in the Planning and Environment Court.
Leighton Pyke, who is behind the Little Projects development responded, saying the company had taken no money from buyers.
“Little projects hasn’t ‘sold’ any units in aperture for the specific reason that the project had no permit. We have secured Expressions of interest for a fully refundable 5k deposit that is conditional on getting a permit,” he said.
“We categorically advised all interested parties that the project did not have a permit.”
Real estate agents forced to tell ‘the truth’
Gold Coast real estate agents and developers will be forced to tell “the truth” about tower projects to stop eager buyers from being left homeless.
The council wants the Office of Fair Trading (OFT) to reform rules that allows developers to sell apartments without having to advertise if the project has received council approval.
More than $70m of units have been sold in four high-profile developments rejected by City Hall in the past year.
In separate examples, people have been left without a roof over their head after selling their properties to buy units in failed projects.
Council CEO Tim Baker has asked OFT and other regulators to tighten property advertising rules to better protect buyers in the hottest property market in more than 30 years.
However, property industry figures warn there is no guarantee the move would provide any greater protection for buyers.
Robina councillor Hermann Vorster, who spearheaded the push, said it was critical to close a loophole that allowed projects to be marketed without revealing their status.
“This isn’t to dissuade sales but it is an important step we need to take to assuage community concerns,”
“I feel we can prevent a lot of unnecessary concern and protect buyers if we can secure this simple change.
“We suffer a reputational risk because the community believes (these developments) are a foregone conclusion and I think it is important that we encourage proponents to be more responsible and to manage expectations of the community and buyers.”
Buyers coughed up more than $65m for a bed in the controversial $100m, 29-story La Mer tower proposed for Main Beach, before it was knocked back by the council in December 2021.
In February, council shot down Melbourne-based developer Little Projects Co’s proposed $73m Broadbeach tower Aperture.
Overlooking Broadbeach State School, its units had already been placed on the market with prices ranging from $2m to more than $7.7m.
The developers of both projects have appealed the decisions in the Planning and Environment Court.
Leighton Pyke, who is behind the Little Projects development responded, saying the company had taken no money from buyers.
“Little projects hasn’t ‘sold’ any units in aperture for the specific reason that the project had no permit. We have secured Expressions of interest for a fully refundable 5k deposit that is conditional on getting a permit,” he said.
“We categorically advised all interested parties that the project did not have a permit.”
A further two projects at Burleigh Heads and Palm Beach were also rejected, despite already being on the market.
Council planning director Alisha Swain admitted there was a widespread issue.
“There are numerous examples where site offices have gone up on (projects) we have refused,” she said.
City planning boss Cameron Caldwell said the situation had left several people effectively homeless after selling their properties to buy units in failed projects.
“Particularly in a rising market, people are selling their homes to downsize to an off-the-plan unit project and then that project does not proceed because of a refusal,” he said.
“They are left having cashed in their residence and in a situation where the market has moved in the interim.
“It has become a huge problem for people who have, in good faith, attempted to move.”
The property industry has had a mixed reaction to the proposal.
Leading developer Ron Bakir backed the idea but warned it would be a “double-edged sword”.
“It would be better for the consumer to have the certainty that the project is going ahead,” he said.
“Obviously, several developers have tried to take advantage of the strong market conditions and had their projects rejected.”
Real Estate Institute of Queensland (REIQ) Gold Coast boss Andrew Henderson said it was a “catch-22” situation.
“There is a shortage of housing and developers seek pre-sales so they can finance projects to go ahead,” he said.
“If it meant people had to wait for approvals then potentially the housing shortage would get even more critical.
“I think this would make existing properties more expensive and there is no guarantee that a project will go ahead, even if it is approved.”
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