Jordan Springs East: Developers of ‘sinking suburb’ deliver extraordinary buy back offer

More than 800 homes in this Sydney suburb could be at risk of sinking and the developer of the estate has now delivered an extraordinary offer.

A western Sydney council has identified more than 800 homes as being at risk of sinking and other damage due to subsidence in Jordan Springs East.

Developers of the area, dubbed the “sinking suburb”, have now delivered a million-dollar offer to buy back the homes if more residents discover serious defects.

Lendlease has made the extraordinary offer after a number of homes suffered cracking and other issues including sinking lawns and driveways, which were first identified in 2018 and have already led to the demolition of two homes.

There’s dispute over what is causing the problems but on September 28, Penrith Council decided to place a notation on 841 homes notifying prospective buyers of possible future issues.

Lendlease says it believes the majority of these homes will not be impacted.

“Based on our investigations and expert advice, we firmly believe the vast majority of properties aren’t impacted by excessive settlement, which is localised to approximately 90 houses in the precinct’s Armoury Road area,” a spokesman said in a statement.

Lendlease had already offered to repurchase 42 homes where damage was found that contravened Australian building standards, with about 20 owners accepting the offer.

However, Lendlease has now decided to extend this offer to all 841 homes subject to the notation if owners also identify settlement damage serious enough to contravene building standards.

More than $600 million worth of real estate is directly impacted by the commitment, The Daily Telegraph reported.

“The reason why we have done this going into Christmas is to provide peace of mind for unaffected properties that still have that notation,” a Lendlease spokesman told news.com.au.

He said the offer would be available for a minimum of five years but will extend to a maximum of 15 years if the council notation is not removed.

RELATED: Unlicensed tradies, falling standards blamed for building defects

A damaged house in Jordan Springs East. Picture: Tim Hunter.

The driveway and front lawn of one home sank as a result of subsidence.

Lendlease has been critical of council’s decision to issue the notation on so many properties, which residents have complained is impacting property prices in the suburb even if their homes are not damaged.

“We’re committed to continuing to work with council on behalf of our customers to remove the notation on those unimpacted properties,” he said.

‘MORAL OBLIGATION’

Penrith Council has defended its decision to issue the notations and said they did so based on independent investigations that confirmed parts of the subdivision may be constructed on fill with low relative compaction.

“We have a moral and legal obligation to give current and future owners information on matters that may impact their property,” Penrith Mayor Karen McKeown said in a statement.

“This is not a blanket notation on the entire area of Jordan Springs East, but is based on the best technical information we currently have.”

Penrith Council initially placed notations on 195 properties in February after investigating issues including a sunken road that impacted the extension of bus services.

It extended the notation to a further 646 properties after receiving advice from two geotechnical experts and a peer review from the NSW Public Works Advisory.

RELATED: Report warned of problems in building industry

Homes in Jordan Springs East are at risk due to subsidence. Picture: Toby Zerna

“The complexity of the ongoing investigations, involving numerous experts, means a clearer understanding of the extent of the fill of relative compaction maybe some months away” the council statement said.

A spokesman said the council welcomed any further assistance Lendlease might offer to impacted properties but was not able to comment on it as it did not have details about the proposed compensation scheme.

Council has pointed the finger at problems with the private certification system, which has taken responsibility away from councils for the final inspection and sign-off on buildings.

“Private certification has been a concern of Penrith City Council, and other councils in NSW, for some years,” a statement said.

“We have made that concern clear in submissions made to State Government inquiries on the private certification industry and statutory framework.

“Council believes that the inherent conflicts with private certification in some cases need to be fixed as a matter of priority to mitigate the risks arising from those conflicts.”

News.com.au contacted the NSW Building Commissioner David Chandler for comment.

In a statement, he said: “Our focus is ensuring that all certifiers, public and private, fulfil their statutory function to act with integrity and independence. The newly issued Certifier Practise Standard highlights the Department’s expectations about how all certifiers perform their role.

“The OC audit program has observed defective work on project involving private and public certifiers.

“The problem of defective work is not just the responsibility of certifiers. While they have a role to play, it is also the responsibility of the other key players — developer, builder, designer — to ensure that the final building product is trustworthy.”

The issue comes after trust in NSW’s new high-rise constructions has been severely eroded in the last few years after the discovery of large cracks at Opal Tower and Mascot Towers.

[e-mail] | @charischang2

Originally published as Jordan Springs East: Developers of ‘sinking suburb’ deliver extraordinary buy back offer