Renovation Tip #1

Undertaking DIY or Renovations Without the Necessary Building Consents.

New Zealanders love the sense that they can increase the value of their property by carrying out do-it-yourself (DIY) renovations. However, please note if your project is inadequately planned, managed or executed the DIY work can cause you serious strife, especially with the regulatory landscape change with the introduction of the Licensed Building Practitioner Scheme. Therefore, it is imperative for DIYers to know what work they can legally do to their property and whether or not a building consent is required for the work.

When is a building consent needed? Certain renovation work under the Building Act 2004 will require a building consent, for example, if:

• • The work will affect the physical reliability of a building
• • It includes the demolition of sections of the existing building or any site works
• • Decks are more than 1 metre in height above ground level
• • A garage is transformed to a living space (and certain other conversions)
• • A window or door is shifted or made larger.

Section 41 of the Building Act sets out the work that does not require consent.

The price of not checking whether a building consent is required for your building project can be incredibly high. It is an illegal offence to perform work requiring a building consent without one. The maximum penalty under the Act is up to $100,000, with a further $10,000 per day in the case of a continuing offence (although the fines imposed are typically less than $10,000). An offence under Section 40 of the Act is also a strict liability offence.

This means that there is no defence mechanism an individual who has violated building consent regulations to say that they did not know they were committing an offence.

Implications of Not Having a Building Consent
A failure to obtain a building consent where it is required for building work can have continuous implications and problems for your property.

Standard Sale and Purchase Warranties
If a DIYer carries out work that required a building consent without one, they will be unable to provide the standard warranties contained in the widely used REINZ/ADLS Agreement for Sale and Purchase. Under the standard agreement, the seller warrants that if they have done or permitted work to be done requiring a building consent, the consent has been attained and the work was completed in accordance with the consent.

Overpassing those standard warranties out is usually a clear indication to the purchaser that they need to make further inquiries about the work carried out at the property. As a result this can put off potential buyers off a sale or seeking a decrease on the price, as house buyers have become more cautious on these relevant factors.

On the other hand, if a seller provides the warranty to the buyer, there is a risk of the buyer discovering the issue at a later date and suing the seller for a breach of warranty for up to 6 years from the date that a sale and purchase agreement was entered into.

Retrospective Consent
If a DIYer later recognises that they should have to obtain a building consent, it may be more difficult to make the work legal than they expect.

For an additional cost, they may apply for a certificate of acceptance for the work. However, this may be unobtainable if there has been any change of standards. A certificate of acceptance looks at compliance with the Building Code at the time of the application, not the time of construction.

Insurance may be declined
There may also be severe insurance implications of not obtaining a building consent. Home and contents insurance can be declined if it is exposed that a building consent has not been obtained when it requires one to carry out building work at the property site.

Other restrictions on DIY work
There are other areas of work that DIYers are restricted from carrying out. The Electricity Regulations provides a list of acceptable electrical work, so it is fundamentally important to check this list before carrying out any electrical work.

Similarly, DIYers are only able to carry out minor plumbing works.

Compliance with the Building Act
Any building work whether requiring a building consent or not – must still be executed appropriately to the standards set out in the agreement with the Building Act 2004. A DIYer who carries out building work will be held liable for that work and, if it turns out to be imperfect, they may be held liable for those defects and problems (as an owner/builder) to any succeeding purchasers of the property.

Therefore it is important that DIYers need to know their own boundaries and limitations, they need to check what the features and aspects are in the Building Act so they know they are complying with its specific regulations. The leaky home crisis has demonstrated that sometimes even minor defects in a construction process can cause unstable damage. A short-term saving in a DIYer carrying out certain work may disperse if a potential buyer is put off by poor workmanship leading to defects in the property – or a succeeding purchaser suffers loss as a result of that work.

Licensed Building Practitioner Scheme Brings Restrictions
From March 2012 onwards, only Licensed Building Practitioners will be able to carry out restricted building work. Restricted building work is defined to include building work that is critical to the reliability of the building. It does not include work for which a building consent is not required.

There have been worries and enquires that these requirements could mean the end of the New Zealand DIY tradition, but this appears unlikely, as the majority of DIY building work will not normally fall within the description of restricted building work.

If certain work does fall within the description of restricted work, a DIYer may be able to apply for an exemption. One of the terms of the exemption will be that the DIYer will have to complete a statutory declaration that they meet the conditions of the exemption process. Their declaration will be available on council files, and subsequent buyers of a property will learn that a non-licensed building practitioner carried out the work.

This could put potential buyers off buying a property or lead them to make more extensive inquiries than they may otherwise have made into the quality of that work. A DIYer will then have to think up the likely pros and cons of choosing not to get the professionals in.

The purpose of the Act is to ensure that buildings:

• • Are safe, healthy and have suitable means of escape from fire
• • Contribute to the physical independence and well being of people who dwells within them
• • Are designed, constructed and able to be used in ways that promote sustainable development.

The regulations prescribe the Building Code with which all building work must comply. Performance standards that must be met include building:

• • Durability
• • Fire safety
• • Sanitation (services and facilities)
• • Moisture control
• • Energy efficiency

Council is both a building consent authority (BCA) and a territorial authority (TA) under the Building Act.
Its function is to:

• • Administer the Building Act 2004 in its territorial district
• • Enforce the Building Code to builders
• • Receive and consider applications for Building Consents
• • Approve or refuse building consent applications within the prescribed time limits
• • Release Project Information Memoranda (PIM)
• • Release Code Compliance Certificates
• • Receive and consider applications for Certificates of Acceptance (COA)
• • Receive and consider applications for Certificates for Public Use (CPU)
• • Issue Notices to Fix Defects
• • Issue Compliance Schedules
• • Record building Warrant of Fitness details
• • Determine whether applications for bond or modification of the building code, or documents for use in establishing compliance with the requirements of the building code should be granted or refused
• • Maintain a building records system available for public access for the life of the building to which it relates

Continue to Renovation Tip #2:

> Discussing your ideas thoroughly with a qualified experienced builder before you start