The ACT government is considering a bond scheme to make developers more accountable for building defects, as it revealed a proposed "defects fund" was abandoned amid concerns it would drive up house prices.
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A government spokesman said it was closely monitoring the NSW government's new strata building bond scheme, with a view to potentially introducing one in the ACT.
In NSW, developers of apartment blocks four storeys and above are required to pay a bond equal to 2 per cent of the price of building work on the project.
That means for a complex requiring $50 million of building work, as much as $1 million would be available to help owners repair defects.
The bond is held for two years after completion of the building, allowing time for structural problems to emerge. Developers are also required to appoint an independent building inspector to check for defects.
The scheme commenced on January 1, 2018.
The ACT Strata Community Association last year called for a NSW-style bond scheme to be introduced in the territory as a tool to make developers accountable for defects at their buildings.
While the bond would not necessarily be enough to cover total repair costs, it would provide owners with a clearer avenue for compensation.
Apartment owners currently face significant hurdles to secure remedies for defects in the ACT after warranty periods expire.
The Canberra Times has reported extensively on cases of owners corporations who have launched legal action to have defects repaired, including at the Elara apartments in Bruce and Kingston Place complex in Canberra's inner south.
Planning for the ACT bond scheme is at a preliminary stage, but the government spokesman said it would be designed to "place greater financial responsibilities on developers and builders to cover defects ... to ensure that any new building in Canberra is of a high quality."
The government revealed it was considering the scheme after The Canberra Times asked why it had not acted on a suite of building regulation reforms flagged in 2010.
Among 11 reforms mooted by the then planning minister Andrew Barr was a proposal to introduce a government-administered "building defects funds", which owners could apply to access to help pay for defects.
This week, the government spokesman said analysis conducted at the time had indicated that the scheme would not have been "financially viable ... without imposing prohibitive costs that could be passed on to consumers".
"This was likely to have an impact on housing affordability," the spokesman said.
However, the growth in Canberra's housing market in the ensuing decade has warranted renewed consideration of some form of building defects compensation fund, the spokesman said.
He said a number of other reforms put forward in 2010 had since been implemented, including a requirement that forces builders subjected to sanctions to re-sit licence exams.
He said the government would consider implementing any recommendations from the ACT Assembly's ongoing building quality inquiry.