Accredited builders and construction professionals in the north of Tasmania are being driven out of the state as ordinary Tasmanians wanting to save money are falling prey to unlicensed operators, an industry lobby group says.
The Housing Industry Association (HIA) says that ‘backyard builders’ are exploiting lax regulation and loopholes in the owner builder regime to operate without a proper construction license, compromising the safety and structural integrity of the finished product.”
HIA executive director Stuart Clues says that under the guise of ‘owner builders’, these ‘backyard builders’ account for more than a quarter (27 per cent) of building work done in the north of the state. This is more than triple the average percentage of work carried out by owner builders in other states (eight per cent.)
“Let’s be clear we are not talking about legitimate owner builders that want to strap on a nail belt and build their own home or shack,” Stuart says. “We are talking about the non-accredited backyard builders operating in northern Tasmania offering to knock up everything from a deck to building entire family homes without building qualifications, experience, insurance or accountability.”
Clues adds that, without effective legislation in place, consumers are often tricked into believing unscrupulous types are qualified builders when they lack the necessary skills. This has led to a situation where those who have the proper qualifications can be squeezed out of the market.
“We have qualified builders being driven out of the state as they are undercut by backyard builders,” he says.
Technically, current law in the state limits the value of work which non-registered builders who are not owner builders are able to perform on any one job to $5,000.
Clues notes, however, that unlicensed operators are able to get around this by encouraging owners to register as owner builders and then to subsequently contract the unlicensed operator in question to perform all or large parts of the work.
Furthermore, Clues says that exposure for consumers with regard to backyard builders goes beyond the actual building work in question and extends to the potential for collateral damage to the rest of the house.
He says that whereas accredited builders are held accountable under the state’s Housing Indemnity Act and WST and can lose their right to accreditation in the event of sub-standard work, there was no such recourse for consumers against backyard builders.
“So if a consumer engages a backyard builder to do building work and the project goes pear-shaped, there is no recourse against that person under the Building Act,” he says. “In this case, the consumer is left with the prospect of trying to recover damages through the court system and in most cases the legal costs make it not worth pursuing.”
Better Disclosure Needed
In order to solve this problem, Clues says the state government needs to do more to protect home owners and home buyers.
In June, the HIA applauded moves by both major parties to reject a Greens amendment to existing legislation which would have increased the threshold of work non-accredited builders were able to do from $5,000 to $15,000.
But Clues says provisions in the new Residential Property Transaction Bill 2012 do not go far enough.
These provisions, which are intended to provide home buyers with important information about the home they are purchasing, will require vendors to disclose information regarding titles, deeds, relating covenants, easements and water and sewerage.
Clues says the new law should also require disclosure about who actually built the house – information he says is readily available from councils.
“Whilst all this information is undoubtedly important, it would be equally useful to know who built the house,” he says. “From this simple question, the prospective buyer could draw their own conclusions about whether the house was constructed by an accredited builder with a good reputation or built by backyard builder.”