Saturday, July 12, 2008

THE AGE: Home loans fall - RBA on track

DATE: July 9, 2008
The biggest monthly fall in the number of home loans approvals in eight years suggests the Reserve Bank of Australia (RBA) may be succeeding in its bid to slow the economy and push inflation down.

Finance approvals for owner-occupied housing declined for the fourth straight month in May, down 7.9 per cent, seasonally adjusted.

Approvals have dropped 25 per cent over the past four months, a move CommSec chief equities economist Craig James said was unequalled in almost 30 years of records.
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COMMENT:
This story suggests that there may be some competition returning to the building industry and home builders (those who can still afford to build) may well find themselves in a stronger position.

Group tackles dodgy builders

Examiner Launceston 8/06/2008 3:51:04 PM | News
Launceston women have formed a new lobby group. Fran Voss reports.

A NEW lobby group has been formed to fight for the interests of the victims of shoddy building practices. Zebra was formed by two Launceston women left shattered by their experiences with builders.

Janine Bransden, of Youngtown, and Anne Fitzgerald, of East Launceston, formed the group last month.

They called for submissions from other Tasmanians with serious building issues and have already received a steady stream of responses. The letters have come from across Tasmania.

"Every one is a tragedy," Ms Fitzgerald said. "People lose their savings, their jobs, their relationships fall apart, they have health problems as a result and they have no protection if they cannot afford to take the builder to court."

The pair called the organisation Zebra because it is an animal that moves in a herd making it less vulnerable to being preyed upon.

They believe only collective power will bring about a change in building regulation.

Ms Fitzgerald said that problems identified by respondents included work unfinished, long delays, builders not returning to fix defects, defects like misaligned brickwork, walls cracking, misaligned roofs, leaking roofs and no redress for the home owner when things went wrong.

The pair believe the current legislation to scrap mandatory housing indemnity insurance, passed by the House of Assembly last week and now before the Legislative Council, is not enough to protect home owners.

The old mandatory housing indemnity insurance scheme covered home owners with building problems but only if the builder died, disappeared or became insolvent.

Builders were forced to take out the last-resort insurance for any work over $120,000 but they pass on the costs - between $1500 and $2000 - to the home owner.

A Senate inquiry into Australia's Mandatory Last-Resort Home Warranty Insurance legislation is due to report its findings in October.

Queensland-based builder organisation Builders' Collective of Australia made a submission to the inquiry calling for the Queensland system of first-resort insurance to be adopted nationally.

President Phil Dwyer said that the Queensland scheme was a first- resort system administered by the Government for 28 years.

If a dispute arises with the builder, the home owner contacts the Building Service Authority, which provides an adjudicator.

If the complaint is justified the builder is given 21 days to correct the defect. If he fails to do so, his registration is suspended.

A warranty scheme appoints another builder to correct the problem at no expense or delay to the homeowner.

Mr Dwyer said that a national first-resort system was desperately needed. He said that last-resort insurance schemes were totally inadequate and did not provide consumer protection.

"It creates a situation where people who require it lose everything from having to go through the court process," he said.

Ms Fitzgerald said that the high incidence of building disputes emerging attention at the highest level. "There's an issue of duty of care for the Government. Unless there are proper regulations and policing the damage to individuals and families is devastating," she said. Home owners with building issues can send their stories of fewer than 200 words to Zebra at PO Box 1165, Launceston 7250. All responses are treated as confidential.

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