ACT Minister for Planning and Sustainable Development Chris Steel says “the financial consequences of poor quality construction” shouldn’t fall on homeowners. Photo: Ian Bushnell.
This week, additional regulations came into effect for the ACT’s housing market. But is it more red tape? Or actual progress?
From 1 October, anyone building three or more homes in the ACT must apply for the new ‘Property Developer Licence’.
The scheme was first flagged in late 2023 as a way for the government to ensure that new homes aren’t only built but also well-built, and don’t leave their owners with costly repairs down the track.
Here’s what you need to know about it.
What was the problem before?
Let’s say you moved into a new apartment three years ago, but you and your neighbours start noticing water leaks, blocked drains, or security issues.
The building’s general two-year warranty expired a year ago, so the building’s owners’ committee is now left to foot the repair bill. And that just doubled your quarterly body-corporate fee.
“Buying a home is one of the biggest financial decisions most Canberrans will ever make,” ACT Minister for Planning and Sustainable Development Chris Steel says.
“Purchasers should feel secure and protected when they buy a new property in the ACT, not faced with the financial consequences of poor quality construction.”
So what’s the new scheme going to achieve?
Under the new rules, developers are responsible for serious defects for up to 10 years, and authorities can pursue multiple developers to fix the defects.
And for the first time, even if the company has gone bankrupt, it won’t absolve management from responsibility, as rectification orders can be issued directly to directors.
For the first two years after a building’s occupancy certificate is issued, the developer is presumed liable for any defects unless they can prove otherwise.
Additionally, a register of licensed developers will be made publicly available, allowing you to easily locate them.
In the words of the ACT Government: “The system will promote public confidence in the standard of residential development in Canberra and ensure that residential development is undertaken by competent developers, encouraging quality and the prevention and rectification of defects.”
Developers will have avenues of appeal, such as the ACT Civil and Administrative Tribunal for review of a licence suspension, or the Supreme Court for rectification orders, stop-work orders or compliance-cost notice.
How much will this cost?
Developers will now need to pay $1000 to apply for a year’s licence, and $500 per dwelling when a building approval is granted.
Surely that’s going to increase construction costs?
Yep, probably.
Ashlee Berry, CEO of the ACT Property Council, warns that the scheme could add both cost and paperwork.
“Each additional requirement adds time and cost to the delivery of homes, so the focus should be on streamlining the system and targeting regulation where it genuinely improves outcomes for buyers,” she said.
She also points out that most serious defects originate from on-site workmanship, rather than the developers themselves.
“Developers play an important role, but accountability must extend to builders, engineers and trade contractors too,” Berry said.
“Introducing trade contractor licensing without delay would be a far more direct way to give buyers and industry confidence that homes are being built to the right standard.”
Berry adds that new homes in the ACT already undergo multiple approval stages – Development Approval, Building Approval, Commencement Notice, and Occupancy Certificate – and the new scheme risks adding more red tape.
“The DA process can involve consultation with up to 11 different ACT Government agencies on issues like trees, heritage, transport or utilities. These agencies can sometimes give conflicting advice, which often creates delays and uncertainty.”
In addition to the time, the fees alone can run into tens of thousands of dollars on larger projects, which Berry said contributes to the cost of new homes.
She said the ACT should learn lessons from across the border in NSW, where a Housing Taskforce, Housing Delivery Authority, and Planning System Reforms Bill are all working to make things more streamlined for home building.
“A coordinated system would cut duplication, resolve conflicts earlier, and give developers and buyers greater certainty about costs and timeframes. That certainty is what ultimately supports more consistent housing supply.”
The ACT Property Council warns that the new licence scheme adds more cost and red tape for developers—and therefore homebuyers. Photo: Michelle Kroll.
Will this really make homes better?
Every new home in Canberra is already subject to “rigorous inspection and certification” before anyone moves in, according to Berry.
But the new scheme does go further – by poring through the developer’s paperwork, including financial records, before work even starts to make sure they’re “fit and proper”.
“It focuses on the eligibility of the development entity and the key people behind a project.”
But it’s still no silver bullet.
“Builders have been licensed in the ACT for many years, but defects still occur,” Berry said.
“The risk with this new scheme is that it focuses on holding people accountable after the fact, rather than driving better outcomes up front.
“We all want higher standards and more accountability. What matters now is getting the details right: clear rules, well-understood processes, careful assessment of impacts, and always keeping the ACT’s housing delivery targets in mind.”
