How to proceed the Strata Building Bond and Inspections Scheme?

SBBIS 8 stages

The Strata Building Bond and Inspections Scheme (SBBIS) started on July 1, 2018. It affects developers who build new residential strata buildings that are at least four stories tall. Now, these developers must pay a building bond to NSW Fair Trading, which is 2% of the building contract price. If, after two years, the developer has failed to fix any rectification work, this bond may be used to cover that cost.

NSW Fair Trading offers a general 8 stages process, let’s explain accordingly.

Stage 1. Building Bond Lodgement:

The developer initiates the process by registering their project on the NSW Planning Portal. Before applying for the Occupation Certificate (OC), the developer lodges the building bond with Fair Trading to comply with the scheme’s financial requirements.

Stage 2 Inspector Appointment:

Within 12 months after the completion of building work, the developer appoints a qualified building inspector.

Stage 3. Interim Inspection and Report:

Between 15 to 18 months post-completion, the building inspector conducts the first inspection of the strata property. An interim report detailing any defects is prepared and shared with relevant parties.

Stage 4. Rectify Defective Building Work:

Between 18 to 21 months after completion, the developer takes action to rectify any identified defects in the building work.

Stage 5. Final Inspection and Report:

Between 21 to 24 months post-completion, the final inspection is conducted, and a comprehensive final report is generated.

Stage 6. Determining the Cost to Rectify Defective Building Work:

If any defects remain unrectified, the cost to fix these issues is determined.

Stage 7. Paying the Building Bond:

If defects are identified in the final report, the building bond is utilized to help cover the costs of rectification. However, if no defects are found, the building bond is returned to the developer.

Any remaining funds, after covering the cost of rectification, are also returned to the developer.

Stage 8. Completion of Process:

The entire process should be concluded within 2 to 3 years from the initial completion of the building work, ensuring compliance with the scheme’s timeline.

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