Advice needed - builder wants to amend contract and take land.

Hi guys,

I have purchased an off the plan apartment. Contract exchanged. It is a two level ground floor apartment with a L-shaped court yard. It is/was private because there is nobody above us looking down and we have a private entry on the ground floor to our apartment.

Now the builder wants to take ~20sqm of land from our courtyard to build a common BBQ area.

So my questions are as follows:

1) Do I have to go ahead with this? I know I can't physically stop them, but they could build anyway and say if you don't like it, rescind the contract. Then they would put it back on the market and sell it.

2) If I do decide to proceed, how do I work out the amount for compensation? Divide by purchase price my total sqm (internal + external) to get an average price and sell it back for the same amount + a little extra more for compensation due to lack of privacy, etc.?

3) If we can't agree on compensation and they go ahead and do the changes without our consent, what avenues do I have to get an independent arbitration/mediation to settle this dispute?

Finally, I know I should be discussing this with my conveyancer/solicitor, but obviously that is not much of an option after close of business Friday. I will meeting with them as soon as possible next week after I visit the property to discuss with the agent.

regards,
pwnitat0r.

 

Read the T&Cs that you signed up to. Many OTP contracts allow the developers to make changes without compensation to the purchasers. Seek legal advice straight away.

 

It's not only the loss of the land.

It sounds as if you will have a communal BBQ area right beside your unit, with the resulting smells and noise.

One for your legal advisor.
Marg

 

I've already said I'll be seeing them ASAP next week.

To keep the thread on track and possibly help me, can people please give input into how they would value the land the builder wants to take back?

E.g. Nearby land sales which are around $2,200/sqm or the average sqm in the purchase price, around $4,500/sqm.

 

Your not losing any land, you do not have any apart from a share in the land itself, your paying for use able space, you do not even own the walls etc by yourself in most strata plans.

You need to read the contract, many people have been sold one thing on plan and get something else at completion.

I would find out what your contract allows exactly next week and if your in no strong position, have a very civil conversation.

 

No land, see your own description above.

 

I think you can have land with strata.

For example I know someone who has a strata titled unit and it has a rear garden which is clearly hers and clearly shown on the plan. She bought the unit new - one of a development of four, off the plan.

 

You can have exclusive use, the land won't be yours though.

In this case nothing exists, contract may say they can vary, you have no land (so no working out value), no exclusive use, no nothing, so will depend on contract.

 

The contract has xx sqm as a courtyard in the contract.

 

You need to find if they can vary that, probably you will find yes.

This happens. Maybe they can move the BBQ ?

 

Contract says they can "make changes as required by the vendor".

I can't rescind contract if they make changes. I'm not sure varying our layout by more than 10% is a "required" change, seems to be stretching a bit too far for a required change? I need to speak to a solicitor, I know.

However, they are saying compensation can be given so if it's not a gesture of goodwill, maybe the change is not required per se? It's just something they want to make.

I had a phone call with council this afternoon who told me the DA was approved in 2016 and they would need to submit another DA to make changes and they haven't done that.

They costed the common area in the property and divided it amongst all the units... this bit of land has been costed to my unit, now they want to take it away and allocate it to common area without it being costed amongst all the units? It's been costed to my unit only.

 

The building is near completion if that helps. This is a last minute change to add a common BBQ area in which is not stipulated in the contract whereas other common property is.

 

Maybe if you talk nice and object nicely they may find a way to put it elsewhere.

Speak to solicitor first, and then see what you can work out, maybe a swap for similar ekswhere in the block, or better ?

 

Have to wonder why the late change.

 

Are you sure?

I know strata covers the common areas but the area to which I referred is completely private use - only accessible from the unit. It is distinct from the shared driveway and gardens.

 

@dabbler isnt saying you cant own the land. He is saying you cant own the land until titles are issued. Before titles are issued it is only a contract, not full ownership through title.

 

The whole thing with strata, is you are not alone, you do everything as a share with others, but you can get exclusive use of some areas, like inside your apartment, your garage, your outdoor area, a store room etc.

With townhouses in a small build of 4, it is possible they could be torrens, so you would own the land. I suppose a strata *could* exclude an area, but then that means people would have a torrens title as well as a Strata plan number, can't say I know if this is done or allowed anywhere.

Can't think of a good example, but imagine a bore. On a torrens block of land, if you have approval, you could sink a bore, on strata title, you would need to ask and get approval also from the other co owners, you can't do as you want, the land is not yours to do as you wish.

But then in Australia, you also do not own what is under the land like in some other places, you need permission from the govt for all things below the surface of value (even water).

The other owners of a strata complex could possibly force you to let them inside your space, say to check a problem or fault or if you changed the walls, on torrens property your neighbor has no rights or mechanism to do this, they do not own any part of the land or building that is yours, is none of their concern bar certain activities.

So if you have a high rise block of apartments, people are buying rights to exclusive use and common areas, if a sink hole forms in our friends balcony/outdoor area, do you think all the other owners can wipe their hands of the issue, or are they stuck as well ? If the roof comes off, does our friend on the ground floor with some land say sorry, that is everyone elses problem, I do not care if the building falls down I own actual land on the ground floor, only all you guys own is space in the air ?

 

One of the reasons I won't do otp

How double standard. Imagine the buyer decided to alter the amount given. Let's just say he wants to alter the contract by 30k

Sounds ridiculous doesn't it

 

I'd ask if they have council approval for the BBQ and area, then politely object
They can't amend the CONTRACT without your agreement, hence the talk of compensation

OTP is a pain, as the developer wants to make a set profit margin, so if the excavation costs more than estimated they will look to reduce costs in other area's (like cheap carpeting instead of tiles) to retain their profit margin.

 

That makes a lot of sense, thanks Stoffo!

I'll definitely be refusing unless I'm offered very good compensation.