If somebody tells you that they have bought a lemon, you know that they have bought a car that has some problems.
From 1996 until 2006 New South Wales voted for a problem vehicle. In relation to the property industry, Bob Carr was a lemon of a Premier. Many of the problems in the industry today are a direct result of the Carr legacy.
In 1997, the Carr Government introduced private certification. It did away with Councils being responsible for certifying construction and handed it over to private certifiers. This meant that, developers paid people to certify the developments.
In a previous attempt to introduce this legislation in 1992, the then Consumer Affairs argued that, if a developer had to pay a private certifier, and a private certifier wants to build a business, the private certifier has to do nice things for the developer. It was like putting Dracula in charge of the Blood Bank.
This is exactly what has happened. Building standards in this State have got so low that Unit values have dropped to all time low. Such wonderful developments as the “Opal Towers”, “Mascot Towers” and the wonderful legacy buildings constructed around Castle Hill. Building standards are rubbish in this State!
As the cat said in Cat in a Hat, “that is not all”. In 2004 the Carr Government did away with Home Owners Warranty Insurance on High Rise buildings. This meant two things:-
1. Home Owners Warranty Insurance only applied to buildings under 3 stories. Home Owners Warranty Insurance did not exist for High Rise Buildings.
2. You did not need a licence to build a high rise. Excellent Government Policy! You don’t get protection and you get an unqualified builder to build your high rise.
The Carr’s greatest contribution came by way of the Vendor’s stamp duty. When the market was at its peak, the Carr Government introduced a 1% Vendor’s duty for people selling their property. Our phones in the office stopped ringing within 30 minutes. I understand this had happened to all law firms across the city.
Apart from obtaining more money for the treasury, it was difficult to understand what Government policy was enhanced by the Vendor duty. Maybe it wasn’t a government policy that needed enhancement. Maybe it was the Premier’s enhancing himself, as he was in the process of purchasing large tracks of property in New Zealand. It has been said that the Carr purchased 10 million worth of property in New Zealand. This may be just a rumour, but its clear that he purchased a lot of property. It may also explain why the Rudd/Gillard Governments appointed him as the Foreign Minister. We all need to visit our investments!
We elected Mr Carr three times to the Premiership of this State. We are now suffering the consequences from a property industry which can be best described as a lemon.