Property buyers await fate in Sydney housing estate debacle
Some 150 families who bought homes in a new estate have faced a gruelling ordeal after a key part of their deals went sour.
Their Aussie dream was ripped from under their feet and their lives have been left in limbo for nearly five years.
And now part of a group of nearly 150 families who were allegedly left millions out of pocket after buying land in a housing estate deal that went sour are soon to learn their fate amid a pending settlement agreement set to go in front of the courts.
It’s a case some observers are heralding as a warning about the perils of buying off the plan in a building industry wracked by bankruptcies and cost blow outs.
The families had purchased blocks in a proposed housing development in northwest Sydney within Clydesdale Estate back in 2020 with the promise of project completion in late 2021.
The Marsden Park project faced numerous delays in the ensuing years and the blocks of land were allegedly not handed over to the buyers, who paid deposits and stamp duty.
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Then the entire project was sold to a third party after a developer involved in the land sales went into liquidation owing a reported $40 million to creditors.
Following the estate sale, the blocks of land were subsequently put back on the market at prices close to half a million higher than what the original buying families had paid, according to an investigation by A Current Affair.
The price increase was partly due to an incredible post-Covid boom in property values.
The families who had paid for the blocks of land in the Clydesdale estate back in 2020 alleged they were never informed of the sites being relisted.
One prospective buyer, who did not wish to be named, revealed to The Daily Telegraph last year that he only found out about the sale when a real estate agent asked if he wanted to repurchase land he had previously signed a contract for – at nearly double the price.
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“It’s disgraceful,” another buyer told A Current Affair in 2024. “It’s unAustralian what they’ve done to us.”
Many of the families involved in the development subsequently joined a class action, spearheaded by William Roberts Lawyers, against Cyan Stone Clydesdale Estate 1 Pty Ltd.
Cyan Stone, a subsidiary of China-based company BHL, was the original developer involved in the sales of the Clydesdale blocks of land in 2020.
The class action was initiated in August by lead applicants Shashank and Natalia Bist, representing those who purchased lots in the Clydesdale development. Astro Fort, which later acquired the development, was also named in the lawsuit.
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The plaintiffs alleged that their contracts to purchase homes in Marsden Park were unlawfully frustrated by the $85 million sale of the lots to Astro Fort in June, according to details of the class action released by William Roberts.
THE NEXT STEP
Families involved in the fiasco may soon be able to move on. A proposed settlement was issued to group members of the class action on May 5 and a hearing on the proposed settlement application is listed to go before the Federal Court later this month.
It’s understood that there are two main election options included in the proposed settlement.
One is for involved families to choose to enter into a new land sale contract for the same lot originally purchased, under certain provisions.
Affected families would have the second option of receiving a cash payment for their lots, provided under a set of terms.
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The settlement application will be put before Justice Ian Jackman.
Affected families revealed their lives were left on hold since 2020 because much of their money was tied up in the development, restricting their ability to move on.
Clydesdale buyers were reported to have paid deposits of between $61,500 to $81,900 in 2020, and 4 per cent stamp duty to the State Government, meaning they’ve had between $90,000 and $120,000 locked up since then, according to media reports.
Many have been renting over recent years and have watched home prices in northwest Sydney balloon in the years since they bought their blocks.
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A median house in the suburb cost about $730,000 back in 2020 but now costs about $1.05 million – $275,000 higher, according to PropTrack research.
It’s understood the project has yet to be completed.
HOUSING COMPLETIONS DOWN
Housing Industry Association economist Tim Reardon said there was currently an industry-wide mismatch between housing approvals and completions.
He estimated that only half the approved unit developments in major capital city markets like Sydney and Melbourne were actually getting constructed.
Many of the projects failing to go ahead were approved when building costs were substantially lower and the developers can no longer afford to deliver the projects at current costs.
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“They’re no longer commercially viable,” he said. “With units, any approval over three years old is very unlikely to get commenced.”
Buyers agent Michelle May said the long list of cancelled or postponed projects seen in many areas should be a warning to home buyers to do their research buying off the plan or in a new estate.
“There are so many risks and unknowns right now,” she said. “You really have to put in a lot of work to do due diligence on builders and developers.
“In my opinion, buying in a newly designed suburb is going to be a lot more risky than buying an established property because a lot of what is promised in new developments doesn’t get built.
“They make all these promises about amenities and services but if you look at the last 20 years, many projects have been cancelled or put on hold because of budget cuts or government changes.
“I would rather buy an established house because you know a lot more about what you’re getting into.”
Representatives of Cyan Stone and William Roberts Lawyers have been contacted for comment.