What work requires a building contract?

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From 1 August 2017, the threshold amount for a major domestic building contract increased from $5,000 to $10,000, and the threshold amount above which cost plus contracts are permitted increased from $500,000 to $1 million.

Work requiring a major domestic building contract

You must have a major domestic building contract, in writing, with your client for work worth more than $10,000, including:

  • erecting or constructing a home and associated work (for example, landscaping, paving, retaining structures, driveways, fencing, lighting, heating, air conditioning, water supply or sewerage)
  • renovations, alterations, extensions, repairs and any other improvements to a home
  • work associated with renovation, alteration, extension or repair of a home. This includes work such as landscaping, paving, retaining structures, driveways, fencing, garages, workshops, swimming pools or spas
  • preparation of plans or specifications for the work
  • demolition or removal of a home
  • any work associated with building on residential-zoned land and for which a building permit is required
  • any site work, including work to ensure access to the property.

However, we recommend you use a written contract for all building work, including work worth $10,000 or less. This helps to:

  • ensure you and your client are clear about the work to be carried out
  • resolve any disputes that may arise.

You must give your client a copy of the Domestic Building Consumer Guide before they sign a major domestic building contract. For more information, view Domestic Building Consumer Guide.

Work not requiring a major domestic building contract

A major domestic building contract is not required for jobs that involve only one of the following:

  • plastering
  • tiling (wall and floor)
  • electrical work
  • glazing
  • insulating
  • painting
  • plumbing, gas-fitting and draining
  • installing floor coverings
  • attaching external fixtures (awnings, security screens, insect screens and balustrades)
  • erecting a chain wire fence around a tennis court
  • erecting a mast, pole, antenna, aerial or similar structure.

Owner builders

Even if your client is an owner-builder on the building permit, you must still:

  • be registered with the Victorian Building Authority to handle a contract worth more than $10,000, or to reblock, restump, demolish or remove a home regardless of the value of this work
  • use a major domestic building contract for work worth more than $10,000
  • provide domestic building insurance for work worth more than $16,000.

You must take out domestic building insurance for the client if the work is worth more than $16,000.

Model domestic building contract for new homes

You can use our free model domestic building contract when planning to build a new home. The contract balances your and your client’s rights and obligations. If a dispute arises, the contract provides a clear path to the requirements of the law.

Download a copy of the Building contract for new homes (Word, 1.2MB)