- How long is Statutory Building Warranty?
- Home Owners Warranty Insurance – What does it cover?
- Home owners Warranty Insurance – Do I need it?
- Building Contracts – Do I need one?
- New small job contracts - What are they?
- How much deposit should I pay a Contractor?
- Does my tradesman need a license?
- How can I check if my tradesman has a licence?
- Do I need a Development Application (DA)?
- What is meant by Exempt or Complying development?
- Do I need to register my swimming pool?
- Do I need a Smoke Alarm?
- How can I check for Asbestos and safely Remove it?
- Body Corporate – What do they pay for in my building?
How long is Statutory Building Warranty?
Commencing 1st February 2012, the warranty period will be 6 years for structural defects and 2 years for non-structural defects. These periods will be extended by 6 months if the homeowner or subsequent purchaser becomes aware of a defect in the last 6 months of these time periods. Builders, developers, owner-builders and tradespeople must warrant that amongst other things, their work has been performed in a proper and workmanlike manner.
Buildings completed before the 1st February 2012 have a warranty of seven years.
Home Owners Warranty Insurance – What does it cover?
If the homeowner cannot recover compensation or have the defects rectified due to the insolvency, death or disappearance of the contractor, they may be able to claim for loss or damage for:
- breach of statutory warranty
- faulty design (provided by contractor or supplier)
- cost of alternative accommodation, removal and storage costs reasonably and necessarily incurred
- loss of deposit or progress payment
- materials and components used in kit home not good or suitable for purpose
- faulty design, or non-supply of a kit home
- non-completion or work due to early termination of the building contract (because of the contractor's or supplier's failure or refusal to complete the work)
- legal or other reasonable costs incurred in seeking to recover compensation from the contractor or supplier for the loss or damage or the taking of action to rectify the loss or damage.
Home owners Warranty Insurance – Do I need it?
Home warranty insurance cover:
- is sold by private insurance companies
- is required for any residential building work or supply of a kit home, where the work requires a licence and is valued at over $20,000 (previously $12,000, this figure was changed to $20,000 as of 1st February 2012).
- must be obtained by the contractor and a certificate given to the homeowner prior to taking any money on the contract and prior to commencing the work.
Home warranty insurance provides cover for:
- structural defects for a period of six years from completion of the work
- non-structural defects for a period of two years from completion of the work.
Building Contracts - Do I need one?
By law, a licensed builder or tradesperson must provide a written contract to the home owner for building work over $1000, or if the cost of the labour and materials to be supplied by the builder or tradesperson is over $1000. This work includes house construction, renovation, addition, maintenance or swimming pool installation. For small jobs between $1,000 and $5,000 please refer to new small job contract advice below.
The written contract must contain the following details:
- the date it was signed by both the builder/tradesperson and the home owner
- the exact name on your builder or tradesperson's licence card and the exact licence number
- the home owner’s name
- a sufficient description of the work to be carried out
- any project plans and specifications attached
- relevant warranties required by the Home Building Act 1989
- the contract price, if known, must be prominently displayed on the front page
- a warning if the contract price is not known or is subject to change, and an explanation of the provisions allowing for variation of the price
- a checklist of questions which aim to ensuring that the home owner understands a number of issues such as the contract price, home warranty insurance, deposits and who is required to obtain council and other approvals
- a clause which requires the builder or tradesperson to carry out the work in accordance with the requirements of the Building Code of Australia
- a clause which requires that all variations must be in writing.
- a clause which requires the builder/tradesperson to provide the consumer with a brochure (the Consumer building guide) which explains procedures for the resolution of contract and insurance disputes.
Small Job Contracts - What are they?
There is a new small job contracts category which has come into effect on the 1st February 2012. A new category of written contracts for small jobs of between $1,000 and $5,000 require the following in writing, dated and signed on behalf of both of the parties and contain the following information:
- the names and signatures of both parties, including the name and number of the holder of the contractor licence
- the contract price where known.
- the date of the contract
- a brief description of the work (including any specifications)
How much deposit should I pay a Contractor?
You should only pay your Contractor a Deposit of:
- 5% where the contract exceeds $20,000, or
- 10% when the contract is $20,000 or less
Does my tradesman need a license?
In NSW you need to be licensed if you:
- are contracted to do residential building work where the labour and materials content is worth more than $1,000
- undertake specialist work such as plumbing, gasfitting, electrical, or air conditioning work
Residential building work means any work involved in the construction of a dwelling, making alterations or additions to a dwelling, or repairs, renovation, decoration or protective treatment of a dwelling. This includes specialist work done in connection with a dwelling. 'Dwelling' includes garages, swimming pools and other prescribed structures constructed for use in conjunction with a dwelling.
Builders or tradespeople who do residential building work without the proper licence are breaking the law and liable for heavy penalties.
How can I check if my tradesman has a licence?
- Ask them! If and when they show it, note that the licence must be for the specific work that you want done. The licence card clearly indicates the category of work for which the holder has a licence, for example, builder, electrician, plumber, bricklayer etc. It should also be current. Do the next step to ensure they have not had a cancellation or suspension of their licence for some reason.
- Check yourself. The following web site is set up on the NSW Office of Fair Trading’s website. Please call us if you have any further question or are unable to access this page. Office of Fair Trading Licence Check
Do I need a Development Application (DA)?
You will need to lodge a Development Application with your local council if your proposed works don’t meet the requirements of Exempt or Complying Development (Please refer to below section). A Development Application (DA) is required for all the following types of development:
- Erect a new building or structure.
- Erect outbuildings, swimming pools, retaining walls, etc.
- Carry out work that is not Exempt Development such as adding to or altering an existing building that does not involve replacing old non-structural materials for new.
- Demolition of a building.
- Demolish, damage or alter a building or place that is a heritage item.
- Change the use of a building or premises to another use. Ie, private residence to Childcare facility
- Subdivide land or strata subdivide a building.
- Display an advertising sign.
- Carry out earthworks, excavation, or filling of land.
To obtain development consent, you must lodge a DA with your local Council. Check with your local council on additional requirements.
What is meant by Exempt or Complying development?
Before you start building it is important to determine whether you are going to need planning approval.
An exempt development is basically a minor development in NSW and often does not require any planning or construction approval.
- Do it yourself renovation work such as replacing the tiles in your bathroom
- or erecting a pre-fabricated structure such as a garden shed.
A complying development is a fast track, 10-day approval process where a building meets all of the predetermined standards established in either a State or local council planning document. For example, a complying development height might be 8.5m, the proposed building’s height therefore cannot be greater than 8.5m. A complying development certificate can be issued by either your local council or an accredited certifier.
(Information extracted from State of New South Wales through the Department of Planning)
Please confirm with your local council on what they classify as Exempt or Complying Development.
Do I Need to Register My Swimming Pool?
Basically, any vessel that can hold 30cms deep of water and can be used for swimming, wading or other aquatic activity is classified as a pool. Includes pools, spas, inflatables, on ground and in-ground.
Swimming pools are to be registered at www.swimmingpoolregister.nsw.gov.au.
They need to be registered before the 29th October 2013. All Multi occupancy developments will require a certificate of compliance by the 29th April 2014 as well as anyone required to lease or sell property where there is a swimming pool.
Do I need a Smoke Alarm?
From 1 May 2006, all NSW residents must have at least one working smoke alarm installed on each level of their home. This includes owner occupied, rental properties, relocatable homes or any other residential building where people sleep. Please refer to the following for more information: http://www.fire.nsw.gov.au/page.php?id=80
Remedial Building are able to help you install and organise smoke alarms if you have not done so already.
Fire & Rescue NSW is urging householders to change their smoke alarm batteries when they change their clocks at the start or end of Daylight Saving.
How can I check for Asbestos and safely Remove it?
With the current renovation boom, we want to help ensure that homeowners and renovators are aware of the risks associated with removing hazardous materials from their homes, such as asbestos, lead, treated timber, volatile compounds and powdered materials.
Asbestos and other hazardous materials have been found to be harmful to your health. Home renovators are strongly encouraged to obtain information on these hazardous materials and to adopt safe working practices when renovating, especially when working on older homes.
Please contact Remedial Building for assistance on identifying dangerous compounds like Asbestos and Lead, and we can help you to remove the danger from your home.
Body Corporate – What do they pay for in my building?
- The area of land and building in the Strata Scheme which do not form part of any Lot
- Services related to the common property (such as water and sewerage pipes and electrical cables)
- Moveable or fixed items regarded as part of the common property (such as carpets in lobbies, fire extinguishers, pools and air-conditioners)
They will not cover:
- Taps, cisterns, cistern cones, ball valves, outlet valves, toilet seats
- If an individual Hot Water Heater is in the unit or the roof space, HWH relief valves, stop cocks, check valves are Owner's Responsibility
- Interior Paint and carpets, wallpaper damaged by water, impact, fire and smoke (excluding fixtures) is covered under the Owner's Contents Insurance
All strata plans are different, so please refer to your Strata Scheme or Strata Manager if you have any questions.