An owner-builder is someone who takes on most of the responsibility for domestic building work carried out on their land.
As an owner-builder you would need to obtain building permits, supervise or undertake the building work, and ensure the work meets building regulations and standards.
In Victoria, an owner-builder can only build or renovate one house every three years, and must intend to live in the house once completed.
If you wish to be an owner-builder, and the value of the proposed building work is more than $12,000 (including labour costs and materials) you will need to apply for a certificate of consent.
Note: The owner-builder should seek a domestic building contract from the person being engaged to do any component of that building work if the value of building work is $5000 or more.
The certificate of consent must be provided to your building surveyor in order to obtain a building permit.
As an owner-builder, you will be given the same level of protection afforded to other consumers under the Domestic Building Contracts Act 1995.
If you are considering submitting an owner-builder application, see Consumer Affairs Victoria's checklist to ensure you have covered all of the necessary information.
Warning for potential owner-builders
Do not submit an owner-builder application if you intend to engage one builder to do all the building work – you will not qualify as an owner-builder. Instead, you will need to enter into a domestic building contract with a registered building practitioner.
Be wary if a builder or tradesperson asks you to sign a building permit as an owner-builder, even though they will be doing the work. This is risky and may end up costing you a lot more than you expect. The builder may be unregistered or trying to avoid their legal responsibilities.
Contact us or your lawyer to get advice before you agree to become an owner-builder in these circumstances.
Even if you have signed as an owner-builder on the building permit:
- you and a builder, contractor or tradesperson must enter into a written contract for domestic building work costing more than $5,000
- a builder, contractor or tradesperson must give you domestic building insurance for work costing more than $16,000
- warranties still apply.
Selling an owner-built house
If you sell your owner-built home within six and a half years after the domestic building work has been completed (ie. from the date of issue of your occupancy permit or certificate of final inspection), you must:
- Obtain a defects report by a prescribed practitioner regarding the domestic building work. The report must not be older than six months and a copy must also be provided to the homebuyer
- Obtain owner-builder domestic building insurance covering the domestic building work and provide the homebuyer with a certificate of the insurance. Please note that the insurance may only come into effect if you die, disappear or are insolvent.
Note: If a registered building practitioner carried out the work under a major domestic building contract, the work should be covered by their domestic building insurance. However you will also need your own domestic building insurance to cover any building work you completed. Domestic building insurance covers non-structural defects for two years and other defects for six years. After six years, the property is no longer covered by domestic building insurance.
If you sell your owner-built home on or after six years, but within six and a half years of completion of building work, you need only provide a defects report.
A buyer of your home who finds defective building work that did not appear on the required defects report can make a claim against you for breach of statutory warranties. If the defective work was carried out by a registered building practitioner, then you may have a claim against that practitioner.
Frequently asked questions
I am registered with the Building Practitioners Board as a domestic builder. Do I still need a certificate of consent?
A certificate of consent is not required if you are a registered commercial or domestic builder, registered demolisher with the Building Practitioners Board or a registered architect with the Architects Registration Board of Victoria.
How do I get a copy of a Certificate of Title/Register Search Statement for my property?
You may contact the Land Titles Office on (03) 8636 2456 or order your Register Search Statement online at www.land.vic.gov.au.
Note: A transfer of land statement, bank mortgage information or letter from a solicitor is insufficient and will not be accepted.
How long will it take for my application to be processed?
Complete applications will be processed within three weeks. Incomplete applications can take longer to process – generally up to 8 weeks.
How do I determine the cost of the proposed building works?
This is the estimated cost if you were to engage a registered building practitioner, including all labour, materials and GST. Your building surveyor can check your estimated costs for accuracy.
Can more than one family member submit an owner-builder application at the same time, if they intend to build on the one allotment?
You will need to consult with your building surveyor, as a subdivision on the land may apply in this instance.