What you should know about being an Owner Builder

An Owner-Builder is a property owner who is also the Builder of the project. If you are considering this, then you need to do some homework first.

Being your own builder will require a substantial investment of your own time and effort. It requires discipline and carries inherent risk. You will be responsible for organising and scheduling all the trades, directly paying their fees, and insuring the works and site. Being an Owner-Builder on any size project is like having another full-time job, so you might consider taking an extended leave of absence from your current career!

We have had experience in the past working with Owner-Builders on institutional projects. (I should point out that Owner-Builder isn’t strictly correct in the commercial world - Client-employed Construction Manager is ‘technically’ correct….). They are able to achieve a 15-30% saving against the commercial cost for building work, but the time to complete is drastically increased, along with your holding costs (such as renting alternative accommodation). Ask yourself the question, does doing the project yourself stack up against the commercial cost (and quicker time) of having a registered Builder do the works?

Further, as the Owner-Builder, you will have all the same legal obligations placed on Commercial Builders. You will be required to provide all the required insurances, making sure your site is safe for tradespersons, and that all the Building Permit conditions are satisfied and actively managed.

The following is based on the infomation available from the Buidling Commission website (accessed December 2019).

An owner-builder is someone who takes responsibility for domestic building work carried out on their own land.

An owner-builder takes on all the risks and responsibilities of a registered building practitioner.

• Owner-builders must obtain a Certificate of Consent from the Victorian Building Authority (VBA) for any domestic building work with a value over $16,000 in order to obtain a building permit.

• Owner-builders can only obtain a building permit for one house in every five year period.

• Owner-builders carry responsibilities even after they sell their home. For example, if you sell your home within six and a half years after you finish the work, you will need to provide a defects report to the buyer and provide certain warranties.

• Owner-builders must intend to live in the house once it is completed.

Discuss your building project with a registered building surveyor well before you are ready to build. A building surveyor is authorised to assess building plans to ensure they comply with the Victorian building laws.

A building surveyor must be appointed for the entire building project. You may choose to appoint a municipal building surveyor who works for a local council or a private building surveyor

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Normally, when a project reaches Practical Completion, the Builder is required to rectify building defects that are discovered within the warranty period. If you want these things fixed you would be the person responsible to get sub-trades to rectify their work rather than holding a Builder to account. Further if you sold the property soon afterwards, this would not absolve you of your responsibilities in warranting the project to the new owners.

You should seek some advice from your architect and trusted consultants and have a frank discussion about performing this role. This is something we would not recommend to anyone who does not have experience in the building industry.

Redmond Hamlett is a Director (Project Architect) of WHDA. You can contact him on 03 7020 5784.