CHU – 6 Common Building Defects to Look Out for in Your Strata Property

Apartment ownership is on the rise, it is often a great entry point for first home buyers as well as first time property investors. One consideration new owners and investors need to consider is building defects. Whether it is a new build, or you are purchasing into an existing building, defects can arise, and it’s crucial to be aware of them and address them as soon as possible to prevent long-term damage and avoid costly repercussions.

The following article outlines some of the common defects found in apartment complexes. It is important for owners to be aware of what to look out for, and the questions to ask to ensure they have all the details to make informed decisions.

1. Building Fabric
Common defects in the building fabric include efflorescence, peeling paint, and minor settlement cracking. While these may not be immediate causes for concern, if left unattended, they can lead to more significant issues.

2. Cladding
Non-compliant lightweight cladding, such as aluminium composite panels or ACP and EPS, is a common issue in strata buildings. This type of cladding can cause a greater potential for fire to spread quickly in a building.

3. Waterproofing
Waterproofing issues can also cause significant problems, such as leakage from roofs, mould, blistering paint, rising damp, and cracked walls. If left unattended continued water penetration into concrete structures such as balconies can lead to concrete cancer, which rusts the steel within the concrete.

4. Plumbing
Plumbing and drainage issues such as blocked drains, leaking pipes, and sewage backups, can cause significant damage to the building’s structure and pose health risks to residents.

5. Electrical
Electrical issues, such as faulty wiring, can lead to power outages, electrical shocks, and fires, all of which can cause significant damage to the building’s structure and endanger residents.

6. Roof Coverings
Defective roof coverings, caused by poor installation, inadequate materials, or poor maintenance, can lead to water leaks and structural damage, ultimately affecting the building’s value and insurability.

Defects can impact Strata insurance policies, which are designed to cover property damage and liability claims. Most insurance policies exclude cover for buildings with defects within the property damage section of the policy however, exposure to claims under the liability section of the policy remains a concern. Note, that in many cases your building can still be insured with defects, as long as you have fully disclosed the information and taken actions to remediate the defect, the insurer will take into account the age of the building and location among other factors and assess the risk of insuring the building. Defects may result in higher premium or excess to cover the building, and some insurers may in fact deem the building to be too risky to provide the cover.

Building defects can cause significant risks and should be addressed as soon as they are discovered.

At CHU, we recommend utilising reputable builders and developers to reduce the risk of defects, and it is crucial to ensure proper maintenance and remediation should defects be discovered post purchase, or midway through a policy cover.

Defects will impact a building’s value and insurability; it is essential to take action to address defects and maintain the safety and value of your property.

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