‘Outrageous’: $120k Hell Breaks Dream

The nurse had saved for five years for a house deposit while renting and wondered if she would ever be able to afford her own house.

But when the federal government’s $25,000 HomeBuilder grant was introduced during the pandemic, Ms. Edelsten knew it was her best shot at catching up with her homeowner friends, combining it with the $20,000 first homeowners subsidy.

She and 20 others signed up for a $270,000 house-and-land package at the Provenance Estate in Bendigo in regional Victoria.

She made two deposits – $7,000 for the land – and another $8750 for construction in May 2020.

The houses were supposed to be ready by May last year, Ms Edelsten said, but instead she has been left “in the dark” with no work being done on her house.

“I was really excited to be a first home owner and I finally did this on my own and now I feel absolutely defeated and just devastated,” she told news.com.au.

“I just feel like I have nowhere to go… and I feel like this is absolutely unfair and the developer just doesn’t care.”

The 45-year-old said there were initial issues with putting the land in the homeowner’s name, which didn’t happen until September last year, pushing it well past the original May 2021 completion date for the homes.

Then was told that construction would start in December last year and then in January, but nothing happened, Ms Edelsten said, with homeowners growing increasingly desperate to find out why.

Finally, they were informed that the builders were having trouble getting insurance to cover the project and that they were undergoing an insurance audit.

But she said she was still confident construction would be completed by September, until a letter bomb dropped into her inbox in May.

“It went on for weeks and weeks and we said we just needed an answer, this goes on forever… and so in the end we just didn’t hear anything and all of a sudden we got a letter from the developer,” she said.

Ms Edelsten was stunned by the letter from developer Huntly Property, which came in through their lawyers.

It said Huntly Property was informed on May 24 that the contracted builders Vita would not be able to proceed with construction and instead several local builders had been approached about the project.

The letter revealed that the cheapest quote would mean that Ms. Eldesten would have to find an additional $120,000 if she wanted to build her mansion.

Otherwise, she had the option of either selling the land back to Huntly Property or selling it on the open market.

However, the sale on the free market was subject to conditions. She would need the developer’s approval for that option and the sale had to be made through the property manager.

“I was just shocked. I could not believe it. I thought it was outrageous the options they gave us,” said Ms Edelsten.

“They’re not viable – none of those options will work. I can’t afford $120,000 more for construction, the bank won’t give me that money, so my only option is to sell the land back.”

Ms. Edelsten said she paid $90,000 for the land and Huntly offered $109,000 to buy it back, but she wasn’t sure if it represented its market value.

She said a Zoom meeting scheduled four days after the letter was sent to discuss the situation was subsequently canceled just 25 minutes before it was due to be held.

“It doesn’t even seem like a fair deal, it’s just very unfair,” she claimed.

“Not once have they said that we are very sorry this happened to you. They never apologized and just didn’t communicate with us the whole time and haven’t been transparent at all and then we just get a letter that says “sorry, we can’t do the build anymore”, and you got just these three options.”

The Victorian nurse said it was also “farcical” to be given only a few days to process the information and then be asked to make a decision.

Ms Edelsten has been forced to move back in with her parents during the ordeal and, given the instability in the construction industry, said one more reason to leave her dream home.

“I no longer have confidence. Mentally I’m so exhausted and I’m over it. Two years of my life have been on hold as I have waited and waited and waited. They clearly knew this six months ago when the builders went through an insurance audit and should have said something,” she said.

“I feel like I missed the boat because the house has made more money and now that wood and labor costs have gone up so much everything is so much more expensive two years later.

“I now feel like I can’t even afford to get into the housing market and I’m going to rent for the rest of my life.”

Ms Edelsten also received a letter from the builders Vita last week.

“Unfortunately, we are not confident that we will be able to obtain the housing insurance necessary to proceed with the proposed construction of the townhouse as we are unable to meet the insurer’s financial and technical requirements,” it read.

“Our position is further complicated by the pressure being exerted on participants in the construction industry related to rising costs and shortages of labor and materials.”

The letter added that despite the $1240 cost, including engineering costs, it would “absorb” the costs and refund the buyer’s entire $8750 deposit.

Ms. Edelsten wants the developers to do more.

“I’d like to see a better offer from the developer and compensation for losing this $25,000 HomeBuilder grant as we didn’t do anything wrong here,” she said.

“It just doesn’t seem fair that we didn’t do anything wrong and now we’re really going to lose out on this.

“I (I) feel in a worse position now than when I started. I feel like I missed the boat… and now I don’t know if I should.”

News.com.au contacted Huntly Property’s attorney and its administrator, but did not hear back.

In a statement to Nine newsHuntly’s attorneys said: “Our client and our firm have sought (urgently) to get further updates from Vita and her attorney, and have also requested that Vita provide immediate clarity to lot owners regarding deposit refunds and timing for such payments, as well as clarifying Vita’s intentions regarding lots where construction has actually begun.

“Our client’s intention is to continue to assist and work with lot owners to achieve the best possible outcome given the circumstances.”

Do you know more or do you have a similar story? We look forward to hearing from you sarah.sharples@news.com.au