A client asked us this last week, and it is the most interesting question we have been asked

about apartments in years — because nothing has gone wrong.

She is in her late thirties and owns one investment property: an apartment she bought off the

plan in 2019 in a mid-rise building, settled in 2021, held ever since. No cracking. No

waterproofing bill. No special levy. No building report she has had to hide from a buyer. By

every measure that apartment owners lose sleep over, she has been lucky.

Then she read that buyers of brand-new apartments are about to get something she will never

have: a ten-year insurance policy against major structural defects, attached to the building

itself.

Her question was blunt. **"If the new ones come with a decade of cover and mine doesn't, have

I just been quietly repriced?"**

What actually changed

One state has just passed legislation laying the final groundwork for a product called

decennial liability insurance. It is a nation-first. It covers repair costs arising

from serious structural defects, for ten years.

One design detail is doing all the work, and almost every report has buried it.

The insurance attaches to the building, not to the builder.

That single line reverses the logic of the last two decades. Until now, an owner's protection

against a serious defect was really a claim against the people who built it — a developer, a

builder, a certifier. Which meant that protection was only ever as durable as those companies.

The two towers everyone remembers were not failures of engineering alone; they were failures of

recourse. Buildings do not dissolve. Companies do.

Cover that sits on the asset survives the liquidation of whoever created it. And because it

sits on the asset, it does something else nobody is talking about: it transfers. The buyer

who purchases that apartment in year four inherits the remaining six years.

That is not a consumer protection. That is an asset characteristic.

The same legislation quietly closes other exits. Private certifiers can no longer surrender

their registration to escape disciplinary action — a provision that tells you, rather

precisely, what some of them were doing.

The answer she didn't expect

Her instinct was that she had lost something. She hadn't. Her apartment is exactly as good as

it was the week before.

What changed is the comparison. Assets are never priced in isolation; they are priced

against the alternatives available to the same buyer on the same weekend. A buyer who

previously chose between two uninsured apartments will increasingly choose between an uninsured

one and an insured one. Her building didn't get worse. The set it competes in got better.

Here is the part investors should sit with. This is already being priced, and we can prove it,

because a version of it exists.

Australia already has an independent ratings agency that scores developers, builders,

certifiers and engineers on track record, financial backing, credentials, capability and

integrity. Not marketing — an assessed, published, per-business rating. Roughly nine in ten

buyers surveyed said they wanted exactly that kind of register.

And the people who lend against these buildings have been unambiguous about what it does.

Where a developer or builder carries an independent rating, financiers say the market's

willingness to look at the deal improves — which lifts the availability of capital and

drives the cost of it down. Insurers use the same signal to decide which practitioners

they will write a building for at all.

Read that again, because it is the whole argument. When an independent, building-specific

signal exists, capital moves toward it and prices it. Not suburb-specific. Not

postcode-specific. Building-specific.

Why a suburb median cannot see any of this

Take two apartments. Same suburb. Same median. Same postcode, same station, same school

catchment, same census profile, same views over the same park. One carries a decade of insured

structural cover that runs with the building and passes to the next owner. The other doesn't.

A suburb median averages both and reports one number.

That is not a flaw you can patch with better suburb data. It is what an average is. And it

is the same structural blindness we measure every day one level further up: between the best

and worst streets inside a single suburb, the spread in effective yield — built from achieved

rents, actual vacancy duration and real days on market, not advertised rents — routinely runs

20 to 30 per cent. Same median. Same postcode. Same laws to the letter.

Apartments push the resolution one level deeper again, because for a unit the asset is not

really the street. The asset is the building. Two towers can face each other across one

road and be entirely different investments: different sinking fund health,

different levy history,

different builder, different certifier,

different remediation exposure,

and now, different insured status. Who delivered it has become a critical

question — not just the finishes and the floorplan.

Nothing about that is visible in a median, a listing photo, or a suburb report.

What she should actually do

Four things, in order.

Find out who built it, and what they are worth now. Developer, builder and certifier are

findable, and so is whether those companies still exist and hold ratings. It is the

highest-value hour available to an apartment owner and almost nobody spends it.

Read the sinking fund like a balance sheet. An underfunded fund is a future special levy

with a date on it. That is the risk her building does carry, insured or not.

Get an indicative insurance quote on the building. An underwriter is the only participant

who has to put money behind an opinion of a specific address, in writing. It is the

most honest second opinion

an owner will ever get, and it is free.

Then price the exit against insured stock. Not against last year. Against what her buyer

will be able to choose from.

The part that should encourage investors

More than 75,000 homes are under construction in the state this legislation covers, and other

states will watch what it does to buyer confidence. Insured buildings are coming, in volume,

and that is unambiguously good — for buyers, and for the credibility of an asset class that has

spent five years apologising for itself.

But understand what is really happening. The market is building a per-building information

layer and attaching a price to it. Lenders will use it. Insurers already do. Buyers will learn

to ask. Every one of those forces sorts good buildings from bad ones below the suburb level.

Which means the discount is moving to the buildings nobody has checked, and the premium is

moving to the ones somebody has. That is not an argument against owning apartments. It is an

argument against owning an unexamined one.

Her apartment is fine. She just needs to be able to prove it — and the owner who can prove it

will sell to the buyer who couldn't be bothered checking the one across the road.

*General information only, not financial or legal advice. Consider your own circumstances and

seek professional guidance before making property decisions.*