Home builders are defying the Building Commission’s orders at an alarming rate

Four in 10 rectification orders issued by the Building Commission to builders of standalone houses were not complied with inside the mandated period, amid warnings of widespread defects across greenfield construction in Sydney’s southwest.

Data obtained by the Herald under NSW freedom of information laws provides a snapshot of the Building Commission’s first-year foray into regulating the construction of residential standalone houses, known as class one buildings, after new powers legislated in late 2023 boosted the scope and funding of the agency beyond apartments.

Homes with defective work are often not being rectified in an acceptable time frame. Credit: Jessica Hromas

Cowboy home builders operating in tough financial conditions have forced the commission to suspend and cancel a spate of licences after defects were found across dozens of sites. Rectification orders are issued where building work is non-compliant as a means of remediating the problem before it becomes a serious defect.

The data comes when the state needs to build 378,000 homes by July 2029. Premier Chris Minns has previously said the quantity required will not come at the cost of quality. The building commission is empowered to try to prevent a repeat of the Mascot and Opal Towers debacles.

Figures provided by the Department of Customer Service show 3339 complaints were received in relation to standalone houses between January 1 and October 8 this year, resulting in 897 inspections. Of those, the commission issued 319 rectification orders, and 126 were not complied with inside the designated period.

The new building commissioner, James Sherrard, told the Herald that he did not believe the proportion of rectification orders disobeyed represented a compliance problem for the regulator.

New building commissioner James Sherrard does not believe the number of rectification orders ignored represents a compliance problemCredit: Janie Barrett

“I don’t believe we do. I mean, you can look at statistics a number of different ways. One in three have already been complied with, I think that is a better way of saying. Some won’t be complied with because the builder has gone under, or some such thing like that,” he said.

Sherrard said “a lot of” rectification orders could not be complied with until the project was complete.

“So the order is effective in ensuring that we have a solution to the problem, albeit that the strict time frame of the order is there to ensure that we get that adherence,” he said.

The Building Commission had also slapped 216 home building licences with conditions in the first 10 months of the year, limiting their work to apartments.

Aggrieved clients of builders have previously questioned the effectiveness of Building Commission-issued rectification orders, finding there was little consequence for builders who defied the compliance measures unless there was a commitment to pursue them legally.

Home owners and building commission sources said that, in some cases, the cost of defying rectification orders had been baked into the costs for builders, who preferred to be fined and then gamble that financially stressed clients would not have the means to seek remedy through the courts.

“Builders would ask if they could pay fines on Amex,” a building commission inspector told this masthead on the condition of anonymity.

The source estimated that 75 per cent of houses being constructed would have at least 10 defects, including major issues such as waterproofing or structural issues, pointing to poor education of tradespeople as the driving force behind defects.

Former building commissioner David Chandler has been heartbroken by the state of some of the buildings he has investigated.Credit: Kate Geraghty

In August, former building commissioner David Chandler told the Illawarra Mercury there was a “deep denial about the quality of home construction”. Inspections of class 1 buildings since last December showed there was “widespread, statewide non-compliant construction going on”.

Grahame McCulloch, a third-party building inspector who worked with a number of customers of Punjabi film producer turned home builder Sippy Grewal, said defective building work was “very, very widespread” in the parts of Sydney’s south-western greenfield fringe where he operated.

McCulloch attributed the shoddy workmanship to accelerated learning pathways for tradespeople, leaving a broader pool of underqualified workers to choose from.

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