And they reckon we're dodgy!
I'm a journalist. I've got some skills after nearly 30 years in that business, but any joker who can kick a football or has an opinion can write a column and get paid for it. That's life. The Journalists' Union doesn't say you can't write a letter to the editor because you're not a registered writing practitioner. It doesn't make you take out compulsory insurance in case you libel someone, cock up your tenses or mix your metaphors. Unfortunately the building and insurance lobbies have a bit more clout than the writing lobby.
Hence the push to discourage
owner building and ensure that building is left to the "professionals".
It started a few years ago... no doubt under pressure from the
big end of town when they noted with horror that a growing percentage
(37% up from 26) of the state's lucrative domestic projects were
being registered as "owner builder" jobs. The Government
and Building Commission were (and are) so slack that they've
never bothered to get accurate, detailed figures on "genuine"
owner building. They're not interested.
In Queensland .6 per cent of
every building project goes into a TAC-style government insurance
fund to fix building problems.
Instead the Commission decided to go after owner builders and pitched its unnecessary "crackdown" to the Government as a "consumer protection" issue. The Commission's own consultant's report found no evidence of consumer complaints or insurance claims worth mentioning in relation to owner building.
Much owner builder work is done
by sub-contracted tradesmen rather than the owner builder him
or herself. In many cases, as with plumbing and electrical, this
is mandatory. You can't even put a sheet of tin on a roof any
more unless you're a registered plumber. All major jobs have
to be covered by contracts and warranty insurance. Owner builder
work has to be inspected and approved by a registered building
surveyor at every stage.
Make no mistake this owner builder crackdown is not about consumer protection. It's about money and lots of it. The domestic building market in Victoria is worth $9 billion a year. The owner builder share 37% of that is more than $3 billion per year. Say it slowly three thousand million dollars.
The Building Commission did not consult real owner builders in its review of owner building, but instead involved insurance companies and big builders who are eager to pick up those $3 billion spoils.
Even at 1 per cent of project value (owner builders tend to get ripped off many times that much for no good reason) the compulsory insurance of owner building in Victoria is a handy $30 million a year earner. It's actually much more because there's contract insurance, plus site/public liability fire/theft insurance plus warranty insurance if you sell within 6.5 years of completion.
So what are the changes and who will benefit?
Owner builders already pay millions of dollars to the Building Commission in fees when they obtain their building permits. The new regulations will make them pay even higher fees because owner-built housing projects will be valued at commercial building rates, rather than the actual owner building cost. That's right. If you can build a house for $120,000 like I did, but a big builder would charge you $200,000 you'll be levied at the $200,000 rate when you apply for a building permit. That makes as much sense as making me pay income tax based on what I would earn if I were a brain surgeon. It's crazy.
The Commission's brochure for owner builders says when applying for an owner builder permit: "Owner builders are required to provide sufficient information to enable the building surveyor to estimate the value of the building work. It must include the commercial rate of labour and materials, as well as GST. The value of the building work is based on what the owner would reasonably expect to pay a registered builder under a major domestic building contract."
That's beautiful... you've got to calculate GST on services you have no intention of purchasing! Then pay the Building Commission's tax based on that.
The same brochure threatens "significant financial penalties" if owner builders fail to fully inflate the "value" of their project. My wife spent hundreds of hours building step by step a beautiful hardwood timber staircase from recycled Victorian Ash for our muddie. The full cost of getting a registered builder to scour secondhand yards, remove nails, hand dress each century-old plank and put together that work of art would be $20,000 plus. It cost us probably $300 for the timber. But if I cost it at $300 I will face "significant financial penalties" according to the Commission. That's just one little, but very real, example of how unjust and misguided and draconian the Commission's whole approach is.
Owner builders are also to be slugged with a new $75 fee on top of that bogus and grossly inflated building permit levy. The $75 alone will generate $600,000 a year for the Commission. All it has to do in return is buy $15,000 worth of computers and $120,000 worth of software... then send out "information kits". Good work if you can get it.
The $75 fee entitles you to apply for an owner builder permit, which (if granted) allows you to apply for an actual owner building permit. This Monty Pythonesque "permit to apply for a permit" will be issued to owner builders by none other than the Building Practitioners' Board. Yes, they've put the foxes in charge of the chook house and will charge the chooks for the privilege.
In this brave new world of owner building you will not only have to fund the Commission's negative propaganda in its war on owner building. You will have to sign and have witnessed a statutory declaration testifying that you have read it. Yes. The Commission has taken this extraordinary and unprecedented step to ensure that its fear mongering tactics have maximum effect. It knows if it forces all potential owner builders to read its anti owner building propaganda it will achieve maximum destruction of the owner building tradition.
The Commission's own report to the Government says it expects owner builder numbers to drop from 33,000 to 8000 thanks to the new laws, and admits "Some of this reduction may occur as better informed owners decide to proceed with a registered builder." That's bureaucrat code for "We're planning to use the money of genuine owner builders to scare the bejesus out of anyone contemplating genuine owner building and thus frighten their collective billions into the arms of our building industry mates."
Already the Commission's "information"
leaflets are littered with scary warnings about the dangers of
time and cost blowouts, public liability, insurance and tax headaches,
faulty workmanship and more. One of its owner builder information
"seminars" recently warned of asbestos, bankruptcy
and marriage breakdowns but failed to mention any positives for
Owner building is worth $3 billion
to Victoria's economy each year. It provides affordable, sustainable
homes to thousands of families. It frees up rental and public
housing for those who need it. It creates a market for sustainable
building practices. (Owner builders pioneered concrete slabs,
material recycling, passive solar heating, solar hot water and
power, waste water recycling and much more.) Owner building teaches
skills, brings families together, and creates some of the most
interesting and environmentally friendly homes in Victoria.
Make no mistake. The fix is in
and all owner builders can do is amp up the common sense they've
always had in spades, then use it to ignore the Commission's
scaremongering and to hack through the red tape they'd like to
choke us with. Support Owner Builder Magazine, and use this web
site (www.byohouse.com.au) to swap notes and ensure that the
proud owner building tradition continues into the 21st century
when it is needed more than ever to ensure affordable, sustainable
housing and the most basic human right to shelter and feed
Snail Mail: 106 Liberty Parade, Bellfield 3081 Victoria Australia