By Charlotte Black
Are you looking to sell your home but are unsure if you need to do anything about the deck you built on your property before you put your property on the market?
The question is one we often get asked at Eales & Mackenzie and the answer is not as straightforward as you may hope.
Section 137B of the Building Act 1993 (Vic) say that if you have constructed a building that is less than six years and six months old, and you are not a registered builder, you must obtain a building report before you sign a contract to sell your property. That report must not be less than six months old and must be given to any intended purchaser.
So does this section apply to you. There are three keys terms which may assist you in determining if you are required to obtain a building report as a result of section 137B.
1. What is a building?
Strangely enough, the question of what a building is again is not a straightforward answer.
You might think that a building is a building, but the definition in the Building Act goes further such that the term building is defined to include any structure, temporary building temporary structure or any part of a building or structure.
The result of this definition is that what is a building is a very broad ranging concept and what many think isn’t a building may in fact be. Examples of a building may include a shed, a garage, a sunroom, a carport or even a deck.
You may therefore find that your deck may require a building report.
2. What does the word construct mean?
Many people think that the term construct would merely extend to the obvious such as a knockdown rebuild, an extension and erecting a granny flat at your home. But what many people do not realise is that the term construct also extends to making alterations to or enlarging a building.
You may therefore find yourself asking, would I need a building report for that kitchen renovation that I just completed. The answer largely depends on the type of work you undertook.
3. Am I an owner-builder?
The Building Act requires you to obtain a building report if the work was undertaken by an owner-builder. If the work was undertaken by a registered builder, then you do not need to obtain a report.
As a result of this, you may be asking whether you are in fact an owner-builder.
The most important thing to remember in determining if you are an owner-builder is just because you engaged a registered builder to assist you in your construction, this does not mean that you are an owner-builder. The question of whether in fact you are an owner-builder is not one that is easily answered.
You may find that you are an owner-builder if you simply managed a sub-contractor to do the work, regardless of whether that sub-contractor is a registered builder.
What are the consequences if I do not get a Building Report?
If you do need to get a building report, you may find yourself considering taking the risk of putting your property on the market without obtaining the report to save yourself the hassle and expense.
However, what many people do not realise is that the consequence of not obtaining the report before you put you property on the market can be dire.
If you do not get the required building report and provide that to the purchaser, a purchaser may end any contract you entered into at any time before settlement is completed.
You may therefore find yourself in a situation where the purchaser elects to end the contract a few days before settlement is due because you did not obtain a building report for the deck you built last year. You are then faced with putting your property back on the market, coupled with the costs of the first, unsuccessful sale. And on top of that, you still need to get the building report.
As can be seen above, the answer to whether you require a building report for works you have done to your property is not easily one answered. However, the consequences of not obtaining a building report where one is required can be substantial.
If you require specialist advice on the sale of your property and whether a building report is necessary, We have experienced Property Lawyers Melbourne clients can turn to for expert advice. Contact Richard Mackenzie on (03) 8621 1000 or advisors@emlawyers.com.au with any questions you may have.
Liability limited by Professional Standards Legislation.
