Victoria has big plans to increase apartment construction across the state, and its latest legislation aims to ensure people want to live in these new high-rise homes.
The state announced on 4 March that it will introduce a new regulator with “tough new powers” to oversee new home building.
Introducing the legislation – called the Building Legislation Amendment (Buyer Protections) Bill 2025 – the state’s premier, Jacinta Allan, said the move was “all about more homes”.
“We will build – and sell – more apartments and townhouses if buyers know they are rock solid and will stand the test of time.”
A substantial pipeline of apartments is planned for Melbourne as well as other regional cities in the state. Image: Unsplash.
The bill has several components. In establishing the watchdog, which will be called The Building and Plumbing Commission, the state will consolidate building insurance, dispute resolution, and compliance monitoring and enforcement under the newly created body.
Noting that the state has big plans for apartment building, particularly around current and forthcoming transit hubs, Ms Allen said it was important that the state provide assurance that those homes will be well made.
“If homebuyers are more confident in the lasting quality of a new home – especially off-the-plan apartments – they’re more likely to buy,” a release from the state said.
Watchdog’s new powers
The Building and Plumbing Commission will reportedly be a “one-stop-shop," according to the state, for consumers who have encountered an issue with the quality of a newly built home.
Currently, builders in the state can be ordered by an existing regulator to fix substandard work, but only before the home is occupied.
Under the changes, the new regulator will have expanded powers for enforcement and can halt the issuing of occupancy permits or the completion of off-the-plan sales for apartment buildings.
“In other words, if it’s not fixed, it’s not for sale,” the release stated.
The new regulatory powers won’t just apply before occupancy. The commission will be able to order the rectification of dodgy building work up to ten years after an occupancy permit is issued.
These new rules are expected to come into effect by the end of 2025.
Once they are in place, builders will face disciplinary action such as the suspension of their registration for compliance failures.
The state is hoping to encourage buyers to consider new builds by boosting confidence in the industry. Image: Getty
Developer bonds
The Building and Plumbing Commission will also oversee a new scheme to hold money from developers to pay for potential defects that appear in the first two years after an apartment block has been built.
Described as a "developer bond,” the government will collect 2% of the cost of constructing the building and hold this money for 24 months, using it to pay for any rectification work that might have to take place.
Longer-term, the government is looking to introduce a 10-year liability scheme to cover apartment defects.
Insurance shakeup
Domestic Building Insurance in Victoria currently protects consumers in the event that a builder becomes insolvent, disappears or dies.
Now, the state is seeking to introduce a “first resort” insurance scheme that gives consumers the ability to make a claim when a building issue is first identified so they can avoid out-of-pocket expenses.
To be overseen by the Victorian Managed Insurance Authority (VMIA), this agency is set to join the new regulator.
More changes in the cards
In the future, the state is considering bringing in more mandatory inspections during construction – specifically, prior to waterproofing and plastering.
Currently up for consultation, this move is an effort to detect non-compliance sooner, so that potential problems are caught earlier and before residents take occupancy.
The state is also investigating mandating “building manuals” for new apartment buildings, which would be prepared by builders or occupancy permit holders and keep all the documentation relating to a construction – including details about previous maintenance – in one central location.
Check out the new homes being planned and built in Victoria at our dedicated New Homes section.
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