The NSW Government is currently running a Voluntary Purchase and
Demolition Program for homes and commercial properties affected by
loose-fill asbestos insulation.
During the 1960s and 1970s loose-fill asbestos insulation was
sold as ceiling insulation. An ACT-based company known as 'Mr
Fluffy', installed this insulation in approximately 1000 homes
in the ACT and NSW.
Now, some decades down the track, we are more educated around
the health risks posed by asbestos. To that end, the NSW Government
has determined that the best way to remove the health risks of this
insulation is through the 'demolition, comprehensive site
remediation and disposal' of affected properties.
Enter the Voluntary Purchase and Demolition Program which is
designed to solve the problem. Fundamentally this initiative
involves the NSW Government purchase of affected premises (this can
be the premises and land, or just the premises itself), for fair
market value. The affected premises are demolished, leaving the
land free for new asbestos free development. The whole process is
overseen by the Loose-fill Asbestos Implementation Taskforce.
If you own investment properties, the NSW Government will
purchase the premises and land at market value, demolish the
premises and remediate the land before selling it. Although other
options are available to homeowners, this is the only option
suitable for owners of multiple dwelling units or strata
One of the main concerns that prospective sellers have had with
this initiative is around the stamp duty that they would inevitably
have to face when purchasing another home.
The NSW Government was proactive in alleviating these concerns
and consequently amended the Duties Act 1977 (NSW) (Act), to add
'Division 5, Part 8 – Concession for persons who have
transferred property affected by loose-fill asbestos insulation to
State'. Pursuant to s104E of the Act, where the owner of a
residential property that will be, or has been, acquired by an
authority of the State due to the land being affected by loose-fill
asbestos insulation – the owner will be entitled to a duty
concession for the purchase of their next property.
If the duty concession is granted, any duty chargeable under the
Act will be reduced by the amount of duty that would have been
chargeable to the Authority of the State. This ensures that an
owner who, for example, sold their $500,000 property to the
Authority of the State, isn't exempt from paying stamp duty on
the purchase of a $2,000,000 property. In those circumstances, they
would receive a concession in the amount of duty that ought to have
been paid with respect to the original $500,000 property.
Free sample testing is currently underway. To be eligible for
the Program, homeowners must be registered for testing by 1 August
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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The High Court of Australia has granted special leave to appeal a decision of the NSWCA that upheld an adjudication determination under the NSW 1999.
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