A guide for Owner Builders on the Central Coast

Being an owner builder is risky. You have a great deal on the line, and usually no industry experience or contacts. If you can afford a professional builder, use one. Not everyone can, which is why this guide exists, but go in knowing what you are actually signing up for, because it is not simply "saving the builder's margin".

Here is the part that surprises almost everyone: you cannot insure the work you do. Section 95 of the Home Building Act says a contract of insurance cannot be entered into for owner-builder work. There is no Home Building Compensation cover standing behind you, and nothing to hand a buyer later. Every defect that appears is yours to pay for.

What you need, by project value

• Under $10,000: no owner builder permit required.
• Over $10,000: you need an owner builder permit. This applies where the work needs development consent or is complying development, on a dwelling house, dual occupancy or secondary dwelling. Every permit requires a white card (the general construction induction card), at any value.
• Over $20,000: on top of the permit and white card, you must complete the approved units of competency. This is what people mean when they say "the owner builder course", and it is the step that only applies above $20,000. The white card is not the course.

The commonly repeated line that you "do the course between $10,000 and $20,000" gets this backwards. Apply through the NSW owner builder permit page.

One more rule worth knowing before you start: you generally cannot get another owner builder permit within 5 years of holding one, or of owning land under one, unless there are special circumstances.

The Service NSW trap nobody warns you about

This one cost me time to work out, and it catches every first time owner builder on the Coast.

You finish the course. You go to Service NSW to apply for your permit, and it asks for your Complying Development Certificate number or Construction Certificate number. So you go to apply for the CDC instead, and that application will not let you submit until you have an owner builder permit.

The permit needs the CDC. The CDC needs the permit. You are stuck, and it is a genuine flaw in the system rather than anything you have done wrong.

The only way through it is to call Central Coast Council, or your certifier, and get a human to help you break the loop. I wish they would fix it. Until they do, do not waste an afternoon assuming you have filled something in incorrectly.

If you are using Central Coast Council as your certifier, these are the details you will be asked for:

• ABN 73149644003
• Company Name: Central Coast Council
• Trading Name: Central Coast Council
• Email: daonline@centralcoast.nsw.gov.au

What you are taking on, in plain terms

Owner building moves risk onto you permanently, not just for the duration of the build.

• No insurance on your own work. Covered above, and it is the big one.
• You carry the statutory warranties. Your immediate buyer is entitled to the benefit of the statutory warranties as if you had done the work under a contract with them: 6 years for a major defect, 2 years otherwise, running from completion. Waterproofing is expressly a major element under the Act, which is worth knowing given how often it is the defect.
• You must disclose on sale for 7 years and 6 months. From the date the permit was issued, any contract to sell the land must carry a conspicuous warning that the permit was issued and that the work is not required to be insured. Leave it out and the purchaser can void the contract before completion. Note the two clocks run differently: disclosure runs from permit issue, warranty exposure runs from completion.
• Buyers know all this. Expect it to come up in negotiation.

Compulsory certifier inspections

These are the critical stage inspections a certifier must carry out. As the person with the benefit of the consent, making sure they actually happen is your responsibility, so tell your certifier before each one:

1. After the commencement of the excavation and before the placement of a footing.
2. Before pouring an in situ reinforced concrete building element.
3. Before covering the framework for a floor, wall, roof or other building element.
4. Before covering waterproofing in any wet areas.
5. Before covering any stormwater drainage connections.
6. After the building work has been completed and before an occupation certificate is issued.

Number 4 is the one that costs the most when it is missed, and there is a full checklist for what to confirm before waterproofing gets covered.

Why get a vesting certificate for materials manufactured offsite?

Anything manufactured offsite belongs to the company making it, even if you have paid for it in full. If that company goes insolvent, the liquidators have a duty to pay creditors and you will not be near the top of the list. A vesting certificate records that on payment, the thing they have manufactured is yours and not theirs, so it does not disappear into the liquidation.

If you are weighing owner building against engaging a builder, the honest comparison is in how to select a builder, and the money side is in how much it costs to build on the Central Coast. If you want a second opinion on whether your project is a sensible one to owner build, send me the address.