Waterproof issues in prospective unit purchase

Hi All,

We are looking to purchase a unit in a building, built only 6 years ago, but the builder was not very good and the waterproofing has failed in many places. Sadly for the original owners they were not able to recover money from the since bankrupted builder.

In the last 3 years since uncovering/ investigating the issues, the OC has raised 220k in special levies to pay for the most urgent repairs, and has just decided to raise another 250k in levies payable next year (not by us though) to complete the rectifications of the defects detailed in the building report. We have read through a detailed full building inspection listing all the defects.

We are satisfied that the bathroom water penetration issues are being dealt with and similar for water penetration issues at the balconies.

One thing that is still a big question mark is the basement car park roof- it was reported that there was water penetration on the roof slab underside. To me, fixing a 2 story basement car park (With a 3 story building on top) sounds like expensive / impossible business. We want to be satisfied that the OC has raised enough money, and that fixing this issue will not blow out to be 2 or 3 times the cost of original levy.

Does anyone have any experience with basement car park water penetration? I know it's not possible to answer how much the bills could run to, but I don't know if this is an issue that *could* be fixed with 20k or more likely one that *could* need up to 1mil.

This is a property for us to live in, and we like it a lot, and have looked at many properties. If it were an investment I would not touch it (I have a feeling many of you will tell us to run run!!). We are budgeting that the repairs will cost 1.5 times what they think, and taking this into account with our pricing, we are also aware of the certainty of repairs being done on the building and the potential noise and mess that might entail. But if basement car park issues are too big a risk then we may just have to let this one go :(. (The building issues have already had an effect on the price of the unit, so if the building issues do indeed get fixed, we think we'll have got a relative bargain, provided they accept our 50% of levy (about 6k) buffer.)

Thanks for your advice!
 
Last edited:
I would run too. we had the same issues in our unit but we were able to sue to builder's insurer under the 7 yr warranty claim. So apart from a few smallish special levies for excesses and independent assessment by engineers, we really weren't out of pocket. We bought cheaply knowing there would be issues, but as you don't appear to be able to rely on an insurance claim, the skies the limit on the costs. We found that some units didn't provide the strata with the damage in their units and some of the damage was difficult to repair, so costs blew out as did the time to get things fixed. I would be worried if I were you. Is this in the lower eastern suburbs? I know of an apartment block not too far from mine that is in that position and most of the occupants had the ceiling ripped out as it was wet beyond repair. The building just looks atrocious.
 
We bought cheaply knowing there would be issues, but as you don't appear to be able to rely on an insurance claim, the skies the limit on the costs. We found that some units didn't provide the strata with the damage in their units and some of the damage was difficult to repair, so costs blew out as did the time to get things fixed.

Do you know what was the average cost per unit in the end to get things fixed? This place is not in the eastern suburbs...
 
In the last 3 years since uncovering/ investigating the issues, the OC has raised 220k in special levies to pay for the most urgent repairs, and has just decided to raise another 250k in levies payable next year (not by us though) to complete the rectifications of the defects detailed in the building report. We have read through a detailed full building inspection listing all the defects.

I find this strange as ones you buy into the block you will be liable for any special levies or for that matter and standard levies.

Just because the BC has voted to raise a special levy does not preclude you from paying those special levies if before the special levies are raised (bill sent out) you become an owner. In this case you may negotiate a reduction on the purchase priced based on the special levy but you will still be responsible for paying it and any future special levy.

As far as ever knowing whether the BC has raised enough money you just never will know as leaks can be funny things. You may think you fixed it but one little thing was missed which can mean starting all over and paying just about the same cost again.

I am with the others - Run Away!!!

Cheers
 
Do you know what was the average cost per unit in the end to get things fixed? This place is not in the eastern suburbs...

The initial claim was for just over half a mil but I think it's closer to a mil now. And now that the claim has closed any further requests by tenants to repair common property due to water penetration comes out of the admin fund. So no guarantee the final figure you are up for will be the final figure.
 
We are looking to purchase a unit in a building, built only 6 years ago, but the builder was not very good and the waterproofing has failed in many places. Sadly for the original owners they were not able to recover money from the since bankrupted builder.



I find it quite strange that no claim has been made on the building's warranty insurance. Its whole purpose is to provide remedy should the builder go broke.
 
I find it quite strange that no claim has been made on the building's warranty insurance. Its whole purpose is to provide remedy should the builder go broke.

Doesnt apply to building over 3 stories which really sux... people think they have warranty and then discover they dont.
 
I think you are talking about a complex we are looking at - most recent report estimates $5-8m in further repairs to rectify the known defects, unclear where the court case will go.
 
Top