2019 has seen many changes that have effected the property industry. From the historic low cash rate to property tax increases in Victoria, the changes implemented in 2019 will continue to affect the market in the years to come.
In Queensland, the cladding compliance consisted of a three-part process. The part 1 deadline was at the beginning of the year on 29 March and required buildings to register using an online system and complete the Queensland Building and Construction Commission Safer Building checklist. The checklist was made up of 4 questions. Upon completion of the checklist, you would be prompted to sign a declaration and would either be finished with the cladding checklist, or pushed to progress into part 2.
Buildings that were required to move on to part 2 had to engage a building industry professional, complete the combustible cladding checklist (part 2) and upload the signed and witnessed checklist and building industry professional statement. Depending on the answers uploaded to the online checklist, you would again either be finished with the cladding checklist or pushed to progress into part 3.
In Queensland, part 3a required all buildings that are progressing to part 3 to engage a fire engineer and register the fire engineer’s details on the Combustible Cladding Checklist.
Part 3b will then need to be completed before the 3 May 2021. This will require the fire engineer to complete a building fire safety risk assessment and statement. These two documents will then need to be uploaded and the online checklist will then need to be filled out and completed.
New South Wales
In NSW, new laws required
buildings with combustible cladding to be registered with the NSW
Government by 22 February 2019. This allows agencies such
as Fire and Rescue to respond appropriately in the event that a fire occurs at
a building with combustible cladding.
As well as cladding concerns, the state has been dealing with the major defects of the Opal Tower and Mascot Towers.
Victoria is the first state
in Australia to assist in paying a percentage of the rectification costs for
combustible cladding on private apartments.
The Victorian State Government announced in July that in Victoria the rectification for buildings that are classified as having extreme or high risk combustible cladding will be funded, at least in part, by the state government. The state government will then seek damages from responsible parties. Initially, it was communicated that apartment owners who had combustible cladding on their building would be responsible for covering the costs of the rectification. The news has been welcomed by those concerned about the high cost of the rectification.
Historic low cash rate
After the first rate drop of 1.25 per cent announced by the Reserve bank in June they announced a further decrease to 1 per cent at the beginning of July.
The Reserve Bank made the decision to decrease the cash rate to “support employment growth” and “provide greater confidence that inflation will be consistent with the medium-term target”.
The lower rates have already began to assist in supporting Australia’s slowing residential market. The low cash rate does not only mean that people won’t be paying back as much interest on their property loans, but it also means that people are able to borrow more. We have already seen signs of this creating property prices to increase throughout the second half of 2019.
Brisbane City Council Developer Update
At the end of July Brisbane City Councillor Matthew Bourke presented about Brisbane’s Future Blueprint and released a draft residential design guide to compliment the Brisbane City Plan.
The key topics from the presentation for developers were that the Brisbane City council aim to;
One, create a city of neighbourhoods; Two, protect and create greenspace; Three, protect the Brisbane backyard and Brisbane’s unique character and Four, ensure the best practice design that complements Brisbane’s character is being implemented.
The two major amendments announced in the presentation were preventing townhouse and apartments from being established in Low Density residential zones and increasing parking ratios to two parking spaces for 2 and 3 bedroom units and 2.5 parking spaces for 4 or more-bedroom units.
The draft document focused achieving better design outcomes for new projects. It included a checklist divided into two sections; processes and elements. Within these sections’ developers will need to undertake various analytics that look into macro and micro scale design. Ranging from the neighbourhood as a whole right down to the visual appeal and identity or even the liveability and function of the development as a standalone.
$17 million-dollar sale
In the second half of 2019 the Gold Coast saw a $17.025 million sale for Village Square.
Village Square, located on the Gold Coast, was established in 1999 as Australia’s first arts and crafts theme park. Unfortunately, there was a lack of attendance at the theme park and the development failed.
The $17.025 million sale was $3.5 million above the valuation. This allowed owners to obtain a significant return from the sale of the scheme as well as pay the outstanding council rates.
The sale of the scheme will create local construction work on the Gold Coast as well as ongoing benefits for the community. It is understood that the buyer is going to turn the scheme into retirement village apartments. This will create jobs on the Gold Coast pre and post development.
Property Tax Increase Victoria
On the 1 July 2019, the foreign investor duty increased from 7% – 8%. This came into effect due to the softening property market and a predicted shortfall in stamp duty of $5.2 billion over the next four years.
How can we help?
While there have been may changes to the property industry throughout 2019, the changes will continue to have an impact on developments for years to come.
At SSKB Developer Consultancy our attention to detail and expertise in establishing quality strata schemes, is sought after by developers looking to successfully market and sell residential and commercial developments.
SSKB Developer Consultancy is a dedicated division of consultants providing prompt, reliable and accurate strata development consulting advice every time.