The Strata Building Bond and Inspections Scheme (the Scheme) is an NSW Government initiative that commenced on 1 September 2014. The scheme requires strata schemes to lodge a building bond with Fair Trading prior to commencing certain types of building work.
The purpose of the scheme is to protect consumers by providing some financial security in the event that defects are not rectified by the builder or developer. For more information regarding Strata Building Bond and Inspections Scheme, you can check out this link https://www.archi-qs.com.au/strata-building-bond-and-inspections-scheme/.
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The Scheme applies to all strata schemes with five or more lots, where the total cost of proposed works exceeds $12,000 (inclusive of GST). For works valued between $12,000 and $20,000, a bond of two percent must be lodged. For works valued at more than $20,000, a bond of 10 percent must be lodged. The maximum amount that can be claimed from the bond is $500,000.
A stratum building bond inspection is required when an owner of a strata scheme wants to sell their unit or make changes to the common property. The inspection report must be provided to the new owner or lessee within 14 days of them taking possession of the property.
In addition to lodgement of the building bond, developers must also appoint an independent certifier to undertake regular inspections of the work during construction and provide a final certificate upon completion. A list of certifiers who have been accredited by Fair Trading can be found on their website.
