Building essentials

Building or renovating your home can be complicated. Whatever stage your project is at, we can help you find the information you need.

Before you select a tradesperson - no matter how small your job is - you should follow these steps.


Get three written quotes


Check their licences

Check they have the right licence for the type of the work you want them to do.

Jobs worth more than $5,000 can only be done by licensed tradespeople.

All electrical, gas and plumbing work, regardless of value, can only be done by licensed tradespeople.


Ask your tradesperson these questions

  • Where can I see examples of your work?
  • Do you have all the necessary insurance?
It is important to check the contractor has all the necessary insurance cover to protect you and your home if something goes wrong. You can find information on the different types of insurance on the Fair Trading website.

The contractor must get Home Building Compensation (HBC) cover if the contract price is more than $20,000.

For more information on selecting a builder, contractor or tradesperson, visit Fair Trading.

When searching for a builder or trade it is important to ask if they have the correct licence. Some of the common licence types and definitions are outlined below:

  • Builder (Licence class BLD) A builder licence is required for any work that is residential building work under the Home Building Act 1989 that involves constructing a dwelling, altering or making additions to a dwelling.
  • Carpenter (Licence class CP01) For licensing purposes, carpentry means cutting and placing timber or timber composites in construction work on-site to erect framing and fix components or assemblies used in construction work, such as stairs, windows, doors, wallboards (excluding plaster boards which is dry plastering), floors etc. It includes erecting metal framing and constructing formwork to prepare for concreting.
  • Joiner (Licence class JOIN) For licensing purposes, joinery means the making and installation of non-structural timber, timber composite or metal components or elements for buildings such as doors, windows, prefabricated glass fencing, stairs, and built-in furniture (such as cupboards, wardrobes, entertainment units and the like), generally made off site and installed as a completed unit.
  • Electrician (Licence class ELEC) An electrical licence is required to do any electrical wiring work in NSW, regardless of cost and regardless of whether it is residential, commercial or industrial. Electrical wiring work is the actual physical work to install, repair, alter, remove or add to an electrical installation, or supervise that work.
  • Plumber (Licence class PLUMCO) A licence is required to do any plumbing, draining or gasfitting (including LP gasfitting) work in NSW, regardless of cost and regardless of whether it is residential, commercial or industrial. For licensing purposes, plumbing work is the work of water plumbing, sewerage or sanitary plumbing, but does not include drainage or roof plumbing.
  • Roof Plumbing (Licence class RPLU) Any work involved to fix, install, renovate, alter, repair and maintain guttering, downpipes, roof flashing and roof coverings, including metal walls and ceilings, on any building or structure (except work in relation to coverings made of non-metallic tiles and slates, glass, concrete, timber etc.)

For more information on these licences and other speciality licences check the NSW Fair Trading website.

By law, your chosen builder, contractor or tradesperson must give you a written contract if:

  • the job is worth more than $5,000 (including GST), or
  • the contractor’s labour and materials is worth more than $5,000 (including GST).

Building jobs worth between $5,000 and $20,000 require a small job contract with minimum basic information and jobs worth more than $20,000 must be covered by more extensive written contracts. Visit Fair Trading for more information and to download these home building contracts for free.


Consumer Building Guide

Builders, contractors and tradespeople must give you a copy of the Consumer Building Guide before you sign a contract for residential building work costing more than $5,000. Read the guide to know your responsibilities, protect your rights and support your building project.


Home building compensation (HBC)

Where work is worth more than $20,000 (including labour and materials), the builder or tradesperson must not start work or ask for any money (including a deposit) until they give you a copy of the HBC cover for your job.

They must also include the cost of HBC cover in your contract. Check if your HBC cover is valid and read more about home building compensation on the State Insurance Regulatory Authority website.


Get the right approvals

To help your building project go smoothly, check with your local council or an accredited private certifier for the approvals your building work needs.


Manage variations

All contracts must be in writing. Any change you need to make to a contract is a ‘variation’. Variations must be in writing and signed by both parties to the contract and will probably impact the contract price. Builders or tradespeople should refer any variation to the contract values to their broker for any change in premium pricing.

Closely inspect the finished project with your builder or tradesperson.

Builders and tradespeople must guarantee that their work is fit for purpose, performed diligently, and delivered in a reasonable timeframe, in line with the contract. Unless otherwise specified, materials should be new and used appropriately.

Everything should be delivered to the plans and specifications in the contract and be in working order. Consider engaging an independent builder or consultant to help. Write down and discuss any defects with the builder or tradesperson.

Consider the difference between a minor and a major defect. Talk to your builder or tradesperson and notify your insurer about any defects once you notice them. Check the Guide to Standards and Tolerances which explains acceptable standards of work, eg how much timber shrinkage is reasonable.

Be familiar with time-limited warranty periods. Legal proceedings to enforce them must be started within two years for all defects and six years for major defects.

Your builder must provide all necessary certificates and documents including:

  • a certificate of compliance for all electrical and plumbing work
  • a final occupation certificate (practical completion certificate).

Let the builder know any concerns you have in writing and keep a copy.

To ensure your new building work remains trouble-free for many years, take the time to understand how to maintain your home and keep the relevant records.


Keeping records is important

Make sure you are prepared for potential problems that may arise.


Defects and liability period

List all items of concern, let the builder know in writing, and keep a copy. Contracts for new homes come with a warranty known as the ‘defects and liability period’ (usually 13 weeks, but this can vary from builder to builder).

Visit Fair Trading for more information on what to do after you build or renovate.

An owner-builder is an individual authorised to do owner-builder work under a permit issued by NSW Fair Trading. Read more about how to become an owner-builder (PDF).

Still not sure? Fair Trading’s owner-builder self assessment tool takes you through a series of short questions to determine:

  • if your building work needs an owner-builder permit
  • if you are eligible for an owner-builder permit
  • which owner-builder permit application form you should use.