“Whether you are buying a new apartment or a new house you should budget for repairs for the most common defects that plague properties. Don’t assume you’ll escape these problems, because you won’t,” Jovcevski says.
Pain point: apartments not built to plan
If you think you’ll be getting what you paid for when buying off the plan, you might want to think again. 20% of people found their apartment was a different size to the plan and 8% were left dealing with the builder changing the finishes during construction.
“When you’re buying off the plan it’s vital to engage with the project and check your apartment is being built to specification at every stage of construction,” says Jovcevski.
“It’s also important not to take the developer’s word around compliance at critical stages of a development. Incredibly, in NSW a developer can select and pay for their own certifiers to verify they have met minimum safety requirements.
“The good news is if your apartment is not built to the specification you signed up for you can start negotiating. From reducing the price of your apartment and getting a full refund, if your property isn’t to plan, you should be compensated.
“That said, it’s also worth remembering that while getting a refund might sound ok, you’ve been delayed from entering the property market. If you are buying in a rising market the refund you receive won’t take into account the increase in property prices and you could be left having to find additional funds to buy a similar property,” Jovcevski says.
Price of property pain
Mozo estimates repairing building defects has cost Australians a staggering total of $10.5 billion over the past decade.
Our research found, when it comes to apartments 4% of new owners had to pay above $50,000 to have repairs done, 23% paid $5,000 to $50,000 and 74% paid up to $5,000.
For house purchasers Mozo’s survey showed 5% had to pay more than $20,000 for repairs, 68% paid up to $5,000 and 27% had to pay $5,000 to $20,000.
“Although you might think you’re bagging a bargain when you buy a new property, it’s important to factor additional expenditure on repairs into your calculations,” says Jovcevski.