‘Never-ending nightmare’: Melbourne residents’ vicious battle over flooded apartments

A group of Ringwood residents remain locked in a vicious battle with their developer over claims of critical defects in their apartments which have left some owners selling at a $150,000 loss and others wading through ankle-deep water.

A group of Melbourne residents remain locked in a vicious battle with their developer over claims of critical defects in their apartments.

A group of Melbourne residents remain locked in a vicious battle with their developer over claims of critical defects in their apartments which have left some owners wading through ankle-deep water after heavy rain.

They allege their developer, Sam Liu of Selling Melbourne, whose personal business now holds the majority of votes on their Owners Committee, has failed to respond to continued cries to rectify defects.

A young family who felt “unsafe” living in their defect-ridden apartment, told the Herald Sun they were forced to sell at an estimated $150,000 below market price.

Other residents, ranging from first-time homebuyers to retirees, say they feel stuck in a “never-ending nightmare” while living in their complex, located on New St in Ringwood.

Michele Ong bought her apartment with her sister three years ago for close to $600,000.

“My sister and I pooled our money together to buy this unit, which was our first home,” she told the Herald Sun.

“We made sure to follow Consumer Affairs guidelines before purchasing. We had a reputable conveyancer check our Section 32, to which he gave the green light, and we signed the contract.”

Michele Ong bought her apartment with her sister three years ago for close to $600,000. Picture: Supplied

The residents say their continued cries to rectify defects have gone ignored. Picture: Supplied

Ms Ong said soon after moving in, she noticed water would pour into the basement carpark on rainy days.

“Even something as simple as a resident on the ground floor washing their pavement saw water seep down the carpark walls,” she said.

After a storm early last year, two units on level one had water gushing in due to non-compliant drains, Ms Ong said.

“The flood also affected two ground units directly below, with water flowing down into their ceiling and coming through the floor,” she said.

“One of the displaced residents, who had water up to her ankles, was not able to move back in for eight months.

“She is an NDIS recipient, and the ordeal placed an extraordinary amount of stress on her.

“Another person also affected by the flood had timber beams on his ceiling to prevent it from collapsing.”

The company A.C.N. 168 653 601, which lists Mr Liu as its director, holds 17 out of a total of 30 units at the complex, with the remaining 13 privately owned, minutes from an annual general meeting reveal.

Ms Ong said soon after moving in, she noticed water would pour into the basement carpark on rainy days. Picture: Supplied

After a storm early last year, two units on level one had water gushing in due to non-compliant drains, Ms Ong said.

“There were three of us (residents) that were on the Owners Committee in the 2023/24 financial year, and we were also part of the Defects Committee,” the residents said.

“We were removed from the Owners Committee at an annual general meeting by one-single entity (the business A.C.N. 168 653 601), which was the developer who held the majority of the votes.

“The makeup of the new Owners Committee consists of the developer, his spouse, and their proxies (under the business A.C.N. 168 653 601), plus one private owner who has very little knowledge of the defects or time to pursue the defects.”

The residents claim that despite their requests for the defects to be rectified, the Owners Corporation Manager has not acted on the instruction of the Defects Commitee.

They claim that despite receiving an occupancy permit in 2020, Essential Safety Measure (ESM) testing – the inspection of fire, life safety and health items in a building – was not carried out in the months after.

They said this was despite there being an outstanding Defect Liability Period retention in the form of a bank guarantee of $211,565 plus GST to rectify defects.

DLP retention is the practice of withholding a portion of payment as a security measure.

The retention fund ensures the contractor fulfils their obligations, particularly addressing any defects. The funds are released after successful defect rectification.

“The DLP retention funds could have been used to rectify the defects if they did ESM testing as they were required to do,” the residents said.

“But they didn’t and the money was released back to the builder a year later.”

They said ESM testing was not carried out until early 2023.

“We discovered this when we looked at 2021/22 financials,” they said.

“So, we queried why ESM had not been carried out even though it was stated in our occupancy permit.

“The developer’s wife said it was the builder’s responsibility and later said it was the builder’s subcontractor’s responsibility, and later after checking with the project management company, she said it was the Owners Corporation’s responsibility to carry out ESM checks.”

The Owners Committee decided not to hold the Owner’s Corporation Manager liable for “fail(ing) to organise” the ESM testing, email correspondence from the developer’s wife reveals.

The residents organised ESM testing to start from March 2023.

“At the end of 2024, we had 174 ESM defects,” they said.

“We also engaged building consultants to do a forensic defects report of our common area, and they found 36 further defects relating to drainage and other various issues.”

Ms Ong said the ordeal had taken a severe mental toll.

“For many of us, these units are either our retirement homes, or first homes, and we have put our life savings into these units,” she said.

“We have nowhere else to go, and we don’t have the finances to up and leave.

“The residents that are looking to sell have been unable to because of the high level of defects.”

Ms Ong said the ordeal had taken a severe mental toll. Picture: Supplied

Ms Meares said the residents only recently discovered that the basement had been left idle for more than three years after the first builder went bust. Picture: Supplied

Ashini Meares, who is in her 60s, bought her apartment in 2021.

“I was hoping to lead a peaceful life, but instead it became a nightmare,” she said.

“So much of my time is taken up trying to solve problems with the building and writing to the relevant organisations that may be able to help us.

“This is like a horror show that never ends.”

Ms Meares said the residents only recently discovered that the basement had been left idle for more than three years after the first builder went bust.

“90 per cent of the Shotcrete walls were complete when the first builder declared themselves bankrupt,” she said.

“When a structure is left idle like that, the integrity of the concrete is impacted.

“Instead of demolishing the whole thing and redoing it, the new builders injected 150 resin injections into the cracks through which water was seeping.

“An expert in the industry told me it was going to cost them at least $2m to fill the site and re-dig it up. So they chose to sting us instead.

“None of this was disclosed when we bought the apartment.”

Ms Meares said the builder had since been back to do “patch-up jobs”.

Ex-owner of an apartment in the Ringwood complex, Mathieu Rosier, said he was forced to sell his three-bedroom, two-bathroom and two-car space apartment for $150,000 less than market price due to defects.

“We sold for $620,000 when similar apartments in the area were going for mid to high $700,000s,” he said.

Mr Rosier said he was forced to sell his three-bedroom apartment for $150,000 less than market price due to the “mountain of defects”. Picture: Supplied

Mr Rosier, who bought the apartment off the plan in late 2017, said he felt “unsafe” living in the apartment with his wife and six-year-old son.

“It was really dangerous. There was fire risk, the plumbing was defective, there was so much rain that would come through – they just cut so many corners on the build,” he said.

“Ultimately we prioritised our health and safety over money, and sold early last year.”

Australian Apartment Advocacy founder Samantha Reece said the Ringwood apartment residents had been “robbed”.

“These are just working class people who wanted to buy a safe place to live and they have been robbed because there is no consumer protection in place to enforce rectification of their defects,” she said.

“As an industry we need to chase these cowboys out of the apartment sector before they erode consumer confidence across the board.”

Ms Reece said Victoria needed to adopt a similar system to New South Wales where developers and builders were tiered as to their ability to perform.

“We no longer wish to see ad hoc developers get away with poor quality because the VBA does not have the authority to enforce standards once the build is complete,” she said.

Residents told the Herald Sun that Maroondah City Council and a structural engineer from the VBA came to inspect the complex last month.

It’s understood the local council has ordered a minor works order to the Owners Corporation.

Residents say they have tried to engage government bodies and Victorian ministers but are yet to receive a response.

“Wherever we go, they say we need to seek a lawyer. We’re clearly not rolling in cash. Like where is justice really?,” Ms Ong said.

“I go to Kmart and buy a $5 T-shirt and I have more consumer rights than over an apartment at $600,000.”

Mr Liu was contacted for comment.

Originally published as ‘Never-ending nightmare’: Melbourne residents’ vicious battle over flooded apartments