ACT News

Fluffy valuations to start this week

The Australian Property Institute will coordinate the ACT's Mr Fluffy home valuation program, with valuers dispatched to homes as early as this week in order to roll out the $1 billion buy-back scheme

Australian Property Institute president Paul Powderly said the Institute's nearly 180 registered ACT member valuers had been briefed on the Mr Fluffy homes and have undergone mandatory asbestos training in readiness for the program.

Two separate valuations would be carried out on each home based on property values as at October 28, when the buy-back scheme was announced.

The average value would then be calculated and offered as a payment to owners by the ACT government.

Chief Minister Katy Gallagher said on Monday a special sitting period could be scheduled before Christmas if a Mr Fluffy appropriation bill isn't passed during the Legislative Assembly's final three days of session later this month.  

The ACT opposition, meanwhile, has asked the government to address growing homeowner concern about the value of homes not keeping pace with a potential housing price bubble. Opposition Leader Jeremy Hanson said he had heard anecdotal evidence that the property market had already heated up in the two weeks since the scheme was announced.

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Mr Hanson said he did not support a proposal for a national levy to fund buy-backs and remediation of the toxic loose-fill asbestos as proposed over the weekend by the Fluffy Owners and Residents' Action Group.

But he recognised the deep frustration of some homeowners who believe they will be forced off their blocks and will face a financial shortfall between their property as it was valued in October and when they buy a new property.

Flyers have appeared near the Legislative Assembly in Civic alleging victims of the Mr Fluffy crisis will be given only "unfair and outdated market value" for their homes under conditions of the buy-back that no other Canberra homeowners would be forced to endure.

Mr Hanson said "once there are a significant number of homeowners who are looking for a house, and that could be measured in the hundreds and possibly looking for similar sort of homes, given supply and demand in the real estate market, prices could be inflated".

Mr Powderly said the valuation date had to be set at a time "where the market is least influenced by the announcement" and stressed that valuers had been instructed to calculate home values based on them having no Mr Fluffy contamination and being presented as they would normally be presented in preparation for being sold.

The head of the ACT Asbestos Response Taskforce, Andrew Kefferd, emphasised that "valuations of affected properties will  be taking place at arm's length and independent of the ACT government and taskforce. This will enable homeowners to have the upmost of confidence in the process and the outcome of the valuations."

Homeowners have been emailed a valuation information pack this week.

Valuers would not penalise homes in poor condition due to being abandoned after asbestos testing came back positive.

"We will look past overgrown gardens and unmown lawns and assess the house as if it was well maintained to go on the market," Mr Powderly said.

He also noted homes which were part way through renovations or extensions would be assessed based on the finished work, minus the cost of the work needed to be carried out in order to get it to that stage.

While Mr Powderly understood the high levels of personal trauma associated with families finding out their home was contaminated with asbestos, he said the valuation program was voluntary and would provide a "fair value based on fair market value."

"Nobody normally writes to me saying we have come back with a value too high for their property. But we stand by our work and the professionalism of our members who don't cave to influence or to government or private interests. Everyone has been briefed to treat these homeowners with the utmost respect and their homes will be valued to their highest and best use, not the lowest. This is the basis of assessing market value."

If a homeowner disputed both valuations, they could pursue a Presidential Determination, whereby Mr Powderly would appoint a third, independent valuer to review any evidence and make a binding determination.

Mr Kefferd noted that the territory would reserve the right to request a Presidential Determination where the two initial valuations varied by more than 10 per cent and would only activate the appeal process if the taskforce and homeowner agreed to be bound by the outcome before it is undertaken – even if it was lower than the average amount.

Any recent and independent valuations sought before the buy-back announcement could be used as evidence by homeowners in a Presidential Determination, Mr Powderly noted.

The ACT government will pay valuers standard rates for their assessments – averaging at about $500-600 per home but higher in the event that homes suffered significant contamination or were partially constructed.

In these limited cases, Mr Powderly said valuers would be accompanied by licensed asbestos assessors and would wear the required protective masks and clothing while inside homes.

"In which case the valuations are going to take longer and cost a bit more."

Mr Kefferd said the buyback would remain open for acceptance for three months after the draft surrender deed was received by the homeowner.

But only one valuation process would be undertaken for each affected home even if owners attempted to opt out or opt back in again in order to "limit opportunities for speculation on property price movements".

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