Sunnylake Residents unwittingly buy non-compliant homes

By Eloise Parrab, Land Lease Communities Officer at the Tenants’ Union of NSW

Nestled along the shores of Lake Munmorah on the Central Coast of NSW lies Sunnylake Shores, an over 55s community operated by Ingenia. However, behind its picturesque facade, there is a tale of frustration for some residents who find themselves entangled in a protracted battle with the operator.

The Compliance Conundrum

Imagine purchasing your dream lakefront home, only to discover that it falls short of local government compliance requirements due to a significant oversight in its design and installation. This nightmare became a reality for some home owners at Sunnylake Shores, including Victor and Kathryn, whose homes were among the five that failed to meet the required separation distance between the homes.

The Local Government (Manufactured Home Estates, Caravan Parks, Camping Grounds and Moveable Dwellings) Regulation 2021 requires manufactured homes to have a separation distance of 3 metres between homes on long term sites. Some homes were installed at separation distances of 2.70 metres. However, the homes Victor, Kathryn and other home owners purchased are within a foot of each other (0.305, less than half a metre) and so close together that when one home owner had a plumbing issue they were advised the operator was trying to get someone small enough that can fit between the houses to fix the problem.

The root of the issue traces back to a decision by Ingenia to modify the original plans for these new homes, substituting open carports with lock up garages to enhance market appeal and sale price. However, this alteration was not accompanied by a revision of where the homes’ would be placed on the land, leading to a breach of the required separation distances, particularly critical given the community is in a high bushfire zone and this lack of separation becomes a fire safety issue.

A Two-Year Struggle

What ensued has been a prolonged saga spanning two years, characterised by promises, delays, and dashed hopes. Despite local Council orders to rectify the noncompliance issue the homes are still non compliant and Ingenia’s response has left much to be desired and has caused a lot of distress to the affected residents.

Residents, eager to move past this ordeal and regain a sense of normalcy, have tried to engage with Ingenia on resolving this issue. Early on in the dispute there were some empty sites in the community and the residents suggested their homes could be relocated to these empty sites (being that they are by design, relocatable homes). Ingenia said no to that proposal, citing that the sites were not big enough for the impacted homes. Much to the dismay of residents some of the homes that Ingenia installed on these lakefront sites are in fact larger than their impacted homes.

Residents Speak Out

The residents have now been provided with possible solutions to resolve the compliance issue. The options proposed by Ingenia are to join the houses with a firewall which in effect will make them a row of terraces or to revert the garages back into carports. The residents have proposed a third option which would result in the residents having what they originally purchased a freestanding house with a lock up garage. Ingenia has purchased one of the affected homes from one of the residents and that home could be removed and then the other impacted homes could be moved down to achieve the required separation distances. The residents’ experience is that Ingenia is only willing to engage on the lowest cost option and will not entertain the highest cost option proposed by residents. An independent professional mediator has been appointed but the dispute is still unresolved and it’s been 11 weeks since there has been any contact from the mediator which is taking its toll on the state of Victor and Kathryn’s mental health.

Victor says “I was diagnosed with a severe anxiety disorder four years ago, which is what led me to move to the Central Coast from Sydney and ultimately, to an over 55s community – I was searching for an easier, stressfree existence where I could concentrate on getting better. This debacle has had the opposite effect on me!”

Kathryn says “Why has this taken so long with no resolution? It has affected my mental health and stress levels as I moved here for a life of new beginnings without stress that buying into an over 55s lifestyle would bring with obtaining a new home that I could move into and enjoy.”

Victor feels neglected and ignored by Ingenia. Written promises by Simon Owen, previous CEO of Ingenia to see this through have resulted in empty promises. Victor says “My experience of Ingenia’s dispute resolution style is very passive-aggressive. Put simply, they’re bullies.”

Residents have been disheartened to see Ingenia’s current heavy marketing campaign of their new residential land lease community development up in Morisset. Ingenia is a very large operator who appears to have abundant manpower and financial resources to support new project development and its marketing, meanwhile a handful of residents who bought and paid for their homes in full, say that they remain a dirty little secret tucked away in the dark somewhere in the Central Coast.

Earlier this year the Australian Financial Review articles described Ingenia Communities as one of the largest companies in the sector, both in terms of existing and future land-lease developments and its valued at $1.8 billion. Shares in Ingenia were reported to have gained 20 per cent over the past year. Victor and Kathryn are calling on Ingenia to focus on their duty of care to the residents living in their communities and not just a responsibility to shareholders to deliver record profits year after year.

This article was published in Outasite magazine issue 11. Outasite is published once or twice annually. Outasite Lite email newsletter is sent several times a year – subscribe subscribe here. All past issues are available in the archive.