Before taking on a building project as an owner-builder you should be aware that owner-builders take on many of the responsibilities of a registered builder. These responsibilities include complying with:
- all building standards including the Building Code of Australia;
- obligations to obtain permits and submit notices and meet other requirements of the Building Services Acts;
- safety laws under the Occupational Safety and Health Act 1984; and
- obligations for insurance, and in particular, home indemnity insurance if applicable.
An owner builder is responsible for the standard of the building work and for its structural soundness and this responsibility may extend for six years or perhaps longer after the building work is complete. An owner-builder is responsible for the management and supervision of the entire project from start to finish and is accountable if the building work is not compliant.
The statutory responsibilities of an owner-builder cannot be delegated, no matter who is employed or contracted to carry out the work.
If you decide to sell the home, you must take out a policy of home indemnity insurance and you may be responsible for rectifying any faults identified by the purchaser after the sale.
Unless you are confident that you can comply with the requirements associated with being an owner-builder and the requirements placed on the building permit issued by the local government, you should seriously reconsider whether you should become an owner-builder.
Displaying a sign
While your building is being constructed you must attach to the site, in a prominent position that allows it to be easily read by the public, a sign of reasonable dimensions that clearly shows your name, the approval number assigned on your owner-builder approval issued by the Building Services Board and your telephone number. Failure to comply with signage requirements may result in prosecution proceedings being commenced or an infringement notice being issued.
Carrying out and supervising the building work
Owner-builders are responsible for the supervision of the building work. Owner-builders may choose to undertake all or part of the building work themselves except where licensed tradespersons such as electricians and plumbers are required by law, or engage a registered builder to oversee part or all of the building work.
Please note that contracting out any of the work does not lessen an owner-builder’s responsibility.
Skills and knowledge
- Be competent to interpret detailed plans and specifications.
- Be qualified to supervise ALL construction work.
- Have the ability to coordinate the flow of work by subcontractors to enable you to complete the home inside your time schedule. Remember that constantly rising costs will have a major effect on the final price.
- Be able to handle financial or contractual disputes with subcontractors and suppliers.
- Be available to be onsite to receive materials and ensure that they comply with specifications, required quantity and quality.
- Have the ability to distinguish technically what is poor building work.
- Have the experience to establish the value of work completed to enable you to make accurate progress payments to subcontractors.
- Have the ability to predict material and labour cost increases that may occur during construction.
- Be able to determine if your land contains reactive clay or other problem soils and, if so, what action must be taken to overcome the problems to ensure the footings are structurally sound. Speak to the building surveyor from the local government office for assistance.
- Be aware of the exact boundaries of your land. Engage the services of a qualified land surveyor if the boundary pegs are not evident or you have doubts as to their correctness.
- Organise insurance to cover liability for personal injury and adequate insurance to cover the work against hazards such as fire, storm damage, theft, public risk and accidents with your insurance company or broker.
- Be aware that the local government building permit imposes time constraints on the completion of your home.
The Home Building Contracts Act 1991 (HBC Act) applies to any person undertaking home building or associated work for a home owner, including owner-builders.
The HBC Act establishes certain contractual requirements in relation to carrying out ‘home building work’ and applies to contracts valued between $7,500 and $500,000.
As an owner-builder, you may be entering into ‘home building contracts’ with contractors. It is important to be aware of the requirements of this legislation.
Please note the National Construction Code or Building Code of Australia is now available free of charge to people who register with the Australian Building Codes Board.
The Housing Industry Association provides information on the building and construction industry, including practitioners and trades.
The Master Builders Association provides contracts for subcontracted building work and a register of consultant building practitioners.
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