Know the risks of an owner builder in Australia

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An individual who is authorised to undertake owner builder work as per a permit from NSW Fair Trading in Australia can be termed as an owner builder here. The work includes construction, alterations, additions or repairs (inclusive of coordination and supervision) for a dwelling. The following two conditions must be fulfilled here:

  • Reasonable market cost (inclusive of materials and labour) is above $10,000
  • It refers to a dual occupancy, single residence or a secondary home needing development consent under the Environmental Planning and Assessment Act of 1979, and complies with the meaning of this Act.

So are you keen to become an owner builder in Australia? Before taking this leap, make sure that you are aware of the country’s legal requirements for carrying out the work, your personal liabilities as well as requirements as per contract.

Understanding the risks

Helplines in Australia get frequent calls from clients who purchase homes with defects. The owner builder is completely responsible for rectifying major defects in buildings. The obligation of having to rectify the work done by subcontractors engaged to complete the work will require patience and perseverance. This is undoubtedly a time consuming task and in case of any hanky panky, you could end up at the Tribunal.

Buildings are designed and made as per existing laws. In case of a problem where laws have been flouted, you could be hauled up. So ensure that the right materials are used, and that there are correct inputs from the architect.

When you sell your home within 6 years of the date as per occupancy permit (Victoria), the sale cannot be completed without giving the purchaser a proper home warranty insurance certificate. People think that a claim on home warranty insurance can be made in case of defects in the house that need rectification, but this isn’t always true.

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