Warranties Provided by The Home Building Act
25 September 2025 in Building and Construction Law | 5 min read | skip to FAQsThe Home Building Act 1989 (NSW) (referred to in this article is HBA) is a comprehensive piece of legislation that sets out, among other things, the minimum standards for residential building work. One of the most important aspects of the HBA is Section 18B, which deals with statutory warranties that are automatically incorporated into every residential building contract. These warranties provide important protections for homeowners and help to ensure that building work is carried out to a high standard. This article discusses these building warranties.
Types of Building Warranties in the HBA
Under Section 18B of the HBA, there are several warranties that are included in every contract for residential building work. These warranties include:
- The work will be carried out with due care and skill.
- The work will adhere to any plans and specifications outlined in the contract.
- All supplied materials will be appropriate and suitable for their intended use.
- Unless otherwise noted, only new materials will be used in the work.
- The work will comply with all applicable laws and regulations, including the Home Building Act.
- The work will be completed with reasonable care and within the agreed-upon timeframe or a reasonable timeframe if not specified.
- If the work involves constructing a dwelling, making alterations or additions to a dwelling, repairing, renovating, decorating or providing protective treatment to a dwelling, the resulting dwelling will be reasonably habitable.
- The work and materials used will be suitable for the specified purpose or outcome communicated to the contractor by the owner, with the owner relying on the contractor’s skill and expertise.
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Who is Covered by the Building Warranties?
These warranties apply to all residential building work in NSW, including new homes, renovations and extensions. They also apply to subcontractors and suppliers who are involved in the residential building work.
One of the most important aspects of these warranties is that they are available not just to the original homeowner who enters into the contract for the building work, but also to any “successor in title” who acquires an interest in the property after the work has been completed (Section 18D(1)). This means that if a person purchases a property that has had residential building work carried out on it, that person is still entitled to the benefit of the warranties.
This is an important protection for homeowners, as it means that if there are any defects or issues with the building work, the defects or issues can be addressed even if the homeowner did not have a contract with the builder and the original homeowner is no longer in the picture. This is particularly important for issues that may not become apparent until some time after the work has been completed, such as defects in the foundation, structural issues, or leaks and water penetration.
It is important to note that as the warranties are automatically included in all contracts, they cannot be waived by any party involved in the construction process. This means that even if the contract contains a clause that purports to exclude or limit the warranties, those exclusions or limitations will not be enforceable (section 18G).
Breaches of Building Warranties
In the event of a breach of any of the warranties provided under Section 18 of the HBA, the homeowner may have the right to seek redress from the builder or any other party involved in the building work. The available remedies will depend on the nature and severity of the breach, but may include requiring the builder to rectify the defect at their own expense or seeking compensation for any losses or damages incurred as a result of the breach.
If the homeowner experiences a loss due to a breach, they have a legal responsibility to minimise that loss by taking reasonable actions. This includes providing written notice of the breach within 6 months after it becomes apparent (Section 18BA(3)(a)) and not unreasonably refusing access to the building work for the purpose of rectifying the breach (Section 18BA(3)(b)).
How Long is the Warranty Valid for ?
Before starting legal proceedings for a breach of statutory warranties, claimants must determine whether the warranty period is still valid. If the work is complete, the warranty period will be determined based on the date of completion. Claimants will then need to determine whether the warranty period is valid. The warranty period for major defects is six (6) years and two (2) years for any other defect and any legal proceedings must be commenced within the warranty period (Section 18E). However, if the when a defect only becomes apparent within the 6 months prior to the end of the time limit, there is an extension of 6 months. This is pursuant to Section 18E, subsection E of the HBA. Section 18E(4) provides the definition of major defect and includes structural problems, including foundations, walls and roofs, water proofing, and fire safety issues.
Defences for Contractors
Section 18F of the Act provides defences for builders against statutory warranty claims regarding work carried out according to instructions from the homeowner or a professional (for example an architect or engineer).
The builder (defendant) will not be liable if the builder can prove that the alleged defect resulted from instructions given by the homeowner against the builder’s advice, or reasonable reliance on instructions from an independent professional acting for the homeowner.
Therefore, it is important that builders and contractors take measures to document their recommendations and opinions in writing to the homeowner if the builder or contractor is instructed to perform work that is contrary to their advice. This should be documented prior to proceeding with the work.
How can BSM Sydney Lawyers assist you?
The expert Building and Construction lawyers at BSM Sydney Lawyer have decades of experience in the construction industry and provide relevant and tailored legal advice with a fast turnaround service. Our building and construction legal team are renowned as industry experts and have worked at all levels of construction from subcontractors, owner builders, home owners, sole building practitioners through to large construction firms. We provide the same level of meticulous, professional and personalised service to all of our clients. Our senior construction lawyers offer a free 20-minute consultation.
Call us to arrange a free 20 minute no obligation consultation that includes case evaluation and cost estimate.
FAQs
What does Successor in Title mean in relation to Home Building Warranties?
Successor in title means that if a person purchases a property that has previously had residential building work carried out on it, that person is still entitled to the benefit of the warranties. It is important to note that the time limit that commences at the date of completion is still the same for successive homeowners of the property.
How Long do I have to claim for a Warranty under the HBA?
The period to claim for warranties under the Home Building Act are based on the date of building completion. Individuals need to commence a claim for a breach of a warranty within 6 years for a major defect and 2 years for any other defect from this time.
BSM Construction Lawyers Sydney are highly experienced in legal action associated with breaches of warranties under the HBA.
Are there Exceptions to the Time Limit for Warranties under the HBA?
Yes, an exception to the time limit for HBA warranties occurs when a defect only becomes apparent within the 6 months prior to the end of the time limit. In this case, there is an extension of 6 months. This is pursuant to Section 18E, subsection E of the HBA.
Can defects covered by Warranties under the HBA be claimed prior to the Completion of Building?
Yes, if defects are identified prior to the completion of work, these can be claimed under the HBA warranty. The construction lawyers at BSM Lawyers Sydney are able to assist you.
What is the Difference between Major and Minor Defects for Warranties under the HBA?
Major defects are structural problems, including foundations, walls and roofs, water proofing, and fire safety issues, while minor defects are considered problems with internal finishes and minor water damage.
Are Warranties covered under the HBA the same as Home Warranty Insurance?
No, warranties covered under the HBA are completely different to home warranty insurance. Builders home warranty insurance is only triggered when the individual builder dies or goes bankrupt or the building company goes into liquidation. This insurance is limited to $340,000. The insurance should have be taken out by the builder for each project. Unfortunately, this is not always the case. Home warranty insurance is also known as the Home Building Compensation Fund. The warranties provided by the HBA are covered by legislation and are a contractual right.
Is there a limit to Compensation covered by Warranties under the HBA?
There is no upper limit as there is with builders home warranty insurance. Commonly, the defects are rectified by the builder. However, if the builder is unable or unwilling to rectify the defects, the homeowner may negotiate for a settlement, with the assistance of an experienced construction lawyer. If an agreement is not reached, litigation in the courts may be necessary.
BSM Construction Sydney Lawyers are expert negotiators and highly successful construction litigators.
BSM Lawyer Sydney have conveniently located offices in Sydney CBD, Parramatta, Sutherland, Shellharbour and Wollongong.
About the Author
Elizabeth DonoghueBachelor of Laws with First Class Honours I Bachelor of Business I Graduate Diploma of Legal Practice I Admitted to the Supreme Court of NSW & the High Court of Australia
View profileElizabeth holds a Bachelor of Business and a Bachelor of Laws with First Class Honours from the University of Wollongong. Elizabeth achieved outstanding results across both of her university degrees and was recognised with the Dean's Merit Award for academic excellence. She has a Graduate Diploma of Legal Practice from the College of Law and is admitted to practice as a legal practitioner in the Supreme Court of NSW and the High Court of Australia. Elizabeth is a valued member of the building and construction and property dispute teams. She is known for her passion for law, strong organisational and communication skills, meticulous attention to detail and proactive approach to her work. Elizabeth has extensive knowledge and experience of legislation relating to home building, including statutory warranties.
