Off-the-plan apartments in Australia commonly suffer from waterproofing failures, structural cracking, poor fire safety compliance, plumbing problems, electrical faults, and cosmetic finishing defects. Research by the UNSW City Futures Research Centre found that up to 85% of apartment buildings constructed since 2000 in NSW contain at least one significant defect, with waterproofing failures accounting for roughly 40% of all reported issues. A 2023 NSW Government study confirmed that 53% of strata buildings registered between 2016 and 2022 had serious defects, with average repair costs reaching $331,829 per building.
Buying off the plan offers potential savings and the excitement of a brand-new property, but the reality is that new does not always mean defect-free. Whether you are a first-home buyer, an investor, or a downsizer, understanding what can go wrong before settlement puts you in a much stronger position. This guide breaks down the most frequently found defects in off-the-plan apartments across Australia, explains why they happen, and outlines your options for getting them fixed.
Why Do Off-the-Plan Apartments Have So Many Defects?
The high rate of defects in newly built apartments is driven by several factors that compound during the construction process. Tight project timelines, cost-cutting measures, subcontractor management challenges, and inconsistent quality control all contribute to the problem.
Large apartment developments often involve dozens of subcontractors working across multiple trades. When scheduling is tight, work gets rushed. One trade finishes before the previous one has been properly checked, and errors get covered up by the next layer of construction. Waterproofing membranes get tiled over before they are tested. Plumbing connections get concealed behind walls before pressure testing is complete.
The NSW Building Commissioner has noted that many defects in new apartment buildings stem from a lack of proper supervision on site and insufficient quality assurance during construction. This is not limited to budget developments. High-end projects can suffer from the same issues.
Developer-driven cost reductions also play a role. Cheaper materials, less experienced tradespeople, and reduced quality assurance processes all increase the likelihood of defects making it through to handover. The buyer typically does not see the finished product until weeks or even days before settlement, which limits the time available to identify and raise issues.
Waterproofing Failures
Waterproofing defects are the single most reported category of building defect in Australian apartment buildings. They account for approximately 40% of all reported defects in new strata buildings, according to research conducted by UNSW and referenced in the NSW Government's Building Commission reports.
Where Waterproofing Fails
- Bathrooms and en suites where membrane application is incomplete or incorrectly lapped at junctions
- Balconies and terraces where waterproofing does not extend properly to drainage outlets or edges
- Rooftop areas and planter boxes where ponding water eventually breaches the membrane
- Below-ground car parks and basement walls where hydrostatic pressure causes water ingress
- Window and door openings where flashing and sealant joints are poorly installed
Why It Matters
A properly applied waterproofing membrane in a bathroom costs around $300 to $400. Rectifying a failed membrane after tiling, fixtures, and cabinetry are installed can cost $15,000 or more per bathroom. In multi-storey buildings, water from a failed membrane can travel through the slab and damage the apartment below, multiplying the repair costs.
Warning
Water damage from failed waterproofing may not become visible for months or even years after settlement. By the time staining or mould appears on a ceiling, the underlying damage can be extensive.
Australian Standard AS 3740 sets out the requirements for waterproofing of domestic wet areas. All new apartments must comply with this standard, and waterproofing must be inspected and certified before being covered by floor and wall finishes.
Structural Defects
Structural defects are among the most serious issues found in off-the-plan apartments. They can affect the safety and long-term stability of the entire building, not just individual units.
Common Structural Issues
- Cracking in concrete slabs, walls, and columns that exceeds normal shrinkage tolerances
- Spalling concrete where reinforcement has been placed too close to the surface or with insufficient cover
- Movement in foundations and footings caused by inadequate geotechnical assessment or poor compaction
- Deflection in floor slabs that causes uneven floors, cracking in partitions, and misaligned door frames
- Post-tensioning tendon failures or grouting deficiencies in reinforced concrete structures
The high-profile cases at Opal Tower in Sydney Olympic Park (2018) and Mascot Towers in Mascot (2019) brought national attention to structural defects in new apartment buildings. Both cases resulted in mass evacuations and highlighted systemic issues in the construction and certification of residential buildings.
| Description | Severity | |
|---|---|---|
| Minor Cracking | Hairline cracks under 0.5mm in plaster or render, typically from concrete shrinkage | Low. Usually cosmetic and repairable with filler and paint |
| Moderate Cracking | Cracks between 0.5mm and 2mm that may indicate minor structural movement or settlement | Medium. Requires monitoring and may need structural engineering assessment |
| Severe Cracking | Cracks over 2mm, diagonal cracking patterns, or cracks through structural elements | High. Requires immediate structural engineering investigation and may affect building safety |
Structural defects must be assessed in accordance with the National Construction Code (NCC) and relevant Australian Standards. Any concerns should be referred to a qualified structural engineer.
Fire Safety and Compliance Issues
Fire safety defects in new apartment buildings pose a direct risk to occupant safety. These defects often go unnoticed by buyers because they are hidden within walls, ceilings, and service risers.
- Non-compliant or combustible cladding materials used on external walls
- Missing or incomplete fire collars and dampers around service penetrations through fire-rated walls and floors
- Gaps in fire-rated wall and ceiling assemblies that compromise compartmentation
- Defective or non-functional smoke detection and alarm systems
- Fire doors that do not close or seal properly
- Inadequate fire hydrant and sprinkler coverage or pressure
The 2017 Grenfell Tower fire in London and subsequent investigations into combustible cladding across Australia led to state government cladding registers and remediation programs. In NSW, the Cladding Support Scheme and the Building Commission actively audit apartment buildings for non-compliant cladding materials.
The NSW Government's 2023 strata defects study found that fire safety defects were the second most common category, appearing in roughly 24% of surveyed buildings. These defects are rarely visible during a standard walk-through inspection.
Plumbing and Drainage Defects
Plumbing problems in new apartments range from minor annoyances like dripping taps to significant issues such as cross-connected hot and cold supply lines or improperly graded drainage.
What to Look For
- Test all taps, showers, and bath fixtures for consistent water pressure and temperature
- Check under sinks and vanities for signs of moisture, dripping, or water stains
- Run water through all drainage points and check for slow drainage or gurgling sounds
- Look for water pooling around floor wastes in bathrooms, laundries, and balconies
- Check that the hot water system is operational and delivers water to all outlets
- Inspect external drainage around the building perimeter for pooling or blocked stormwater pits
Common Plumbing Defects
- Leaking joints at concealed pipe connections within wall cavities
- Incorrectly graded waste pipes that cause slow drainage or recurring blockages
- Cross-connected supply lines where hot and cold water are reversed
- Missing or defective backflow prevention devices
- Insufficient water pressure on upper floors of taller buildings
- Poor sealing around penetrations through waterproofed areas
Plumbing work in new buildings must comply with AS/NZS 3500 (Plumbing and Drainage) and the Plumbing Code of Australia. All plumbing work should be carried out by licensed plumbers and inspected by the relevant authority.
Electrical Defects
Electrical defects are surprisingly common in new apartments and can present safety hazards if not identified and corrected before occupancy.
- Power points and light switches that are dead, incorrectly wired, or mounted off-level
- Missing or non-functional safety switches (residual current devices) on circuits
- Exposed wiring or junction boxes left uncovered in ceiling spaces or behind access panels
- Smoke alarms that are not connected or do not meet current Australian Standards
- Down-lights installed without required clearance from insulation, creating a fire risk
- Insufficient power points for the room size or layout, not matching the contract specifications
Important
All electrical work in Australia must be carried out by a licensed electrician and must comply with AS/NZS 3000 (the Wiring Rules). Safety switches are mandatory on all power point circuits in new residential buildings.
Cosmetic and Finishing Defects
While cosmetic defects are not safety hazards, they are among the most commonly reported issues at handover. In a brand-new apartment, buyers rightly expect a high standard of finish.
Paintwork
- Uneven coating, visible brush or roller marks, and inconsistent colour across walls and ceilings
- Paint overspray on window frames, door hardware, or finished surfaces
- Missed patches behind doors, inside wardrobes, or in corners
- Cracking or peeling paint on recently applied surfaces, suggesting poor surface preparation
Flooring
- Scratched or chipped timber, laminate, or tile flooring
- Uneven tile installation with lippage (height difference between adjacent tiles) exceeding acceptable tolerances
- Grout lines that are inconsistent, cracked, or incomplete
- Carpet that is poorly stretched, showing wrinkles or lifting at edges
Joinery and Cabinetry
- Cabinet doors and drawers that do not align properly or that stick when opened
- Benchtops with chips, scratches, or gaps at wall junctions
- Wardrobe doors that come off track or do not close flush
- Skirting boards and architraves with visible gaps, poor mitres, or nail holes left unfilled
Cosmetic defects should be documented in writing and with photographs during your pre-settlement inspection. The developer is obligated to rectify these items before or shortly after settlement, depending on the terms of your contract.
HVAC and Ventilation Problems
Heating, ventilation, and air conditioning (HVAC) systems in new apartments can have defects that affect comfort, air quality, and energy efficiency.
- Air conditioning units that do not heat or cool effectively or that produce excessive noise
- Blocked or disconnected ventilation ducts in bathrooms, laundries, and kitchens
- Inadequate natural ventilation in habitable rooms that does not meet NCC requirements
- Condensation on windows and walls caused by poor ventilation, which can lead to mould growth
- Ductwork that is not properly sealed, allowing conditioned air to escape into ceiling spaces
- Mechanical exhaust fans in bathrooms that vent into the ceiling cavity rather than to the exterior
The NCC requires that all habitable rooms have adequate ventilation, either through natural means (openable windows) or mechanical systems. Bathrooms without windows must have mechanical exhaust ventilation that discharges directly to the outside of the building.
Common Area and Shared Facility Defects
Defects in common areas affect all owners in a strata scheme, not just individual lot owners. These areas are maintained by the owners corporation, and the cost of repairing common area defects is typically shared across all lot owners through the strata levies.
- Lift installations that malfunction, produce excessive noise, or do not level correctly at floors
- Car park drainage issues, including ponding water, cracked concrete, and leaking joints in basement waterproofing
- Common corridor and lobby finishing defects such as damaged tiles, poor paintwork, and misaligned fixtures
- Landscaping that does not match the development plans or that causes drainage problems
- Swimming pools, gyms, and rooftop terraces with incomplete or defective installations
- Waste management systems that are undersized, poorly ventilated, or not functioning as designed
Tip
In NSW, the Strata Building Bond and Inspections Scheme requires developers to lodge a building bond equal to 2% of the total construction cost. This bond is held for two years and can be used to fund the rectification of defects identified through mandatory inspections in the first 18 months after completion.
How to Protect Yourself as a Buyer
Taking the right steps before and during settlement significantly reduces the risk of being left with costly defect repairs.
Engage an independent building inspector
Book a qualified building inspector to carry out a thorough pre-settlement inspection of your apartment. Do not rely on the developer's own quality checks. An independent inspector works for you and will identify defects that the builder may have overlooked or chosen not to disclose.
Inspect before settlement, not after
Your inspection should happen before you sign off on settlement. Once you settle and take possession, it becomes significantly harder to hold the developer accountable for defects that should have been rectified at handover.
Document everything with photos and notes
Create a detailed written list of all defects found, supported by photographs showing each item clearly. Date-stamped photos provide strong evidence if a dispute arises later.
Submit a formal defect list to the developer
Provide the defect list to the developer in writing. Request written acknowledgement and a timeline for rectification. Keep copies of all correspondence.
Understand your defect liability period
Most states provide a statutory defect liability period during which the builder must return to fix defects at no cost. In NSW, the Home Building Act 1989 provides a 2-year warranty for minor defects and a 6-year warranty for major structural defects.
Get involved in your owners corporation early
Attend strata meetings and push for independent building inspections of common areas. The sooner defects in shared spaces are identified and reported, the more likely they are to be rectified under warranty or the strata building bond.
Your Legal Rights When Defects Are Found
Australian buyers have statutory protections when defects are found in newly built apartments. These protections vary by state but generally provide meaningful recourse.
| Key Legislation | Defect Warranty Periods | |
|---|---|---|
| NSW | Home Building Act 1989 | 2 years for minor defects, 6 years for major structural defects from completion |
| VIC | Domestic Building Contracts Act 1995 | 6 years for structural defects, varies for non-structural based on contract terms |
| QLD | Queensland Building and Construction Commission Act 1991 | 6 years and 6 months for structural defects, 1 year for non-structural defects |
| SA | Building Work Contractors Act 1995 | 5 years for building work defects from date of completion |
| ACT | Building Act 2004 | 6 years for structural defects, 2 years for non-structural defects |
If the developer refuses to rectify reported defects, you have several options depending on your state:
- Lodge a complaint with NSW Fair Trading, QBCC, VBA, or the relevant state regulator
- Apply for dispute resolution through your state's building dispute tribunal (such as NCAT in NSW or VCAT in Victoria)
- Engage a solicitor experienced in construction law to issue a formal notice or commence proceedings
- Commission an independent defect investigation report from a qualified building consultant to support your claim
Key Takeaways
- Up to 85% of apartment buildings built since 2000 in NSW have at least one significant defect, with waterproofing failures being the most common category at around 40% of all reported issues.
- Waterproofing defects in bathrooms and balconies can cost over $15,000 per area to rectify once finishes are in place, compared to $300 to $400 for correct initial installation.
- Structural defects, fire safety non-compliance, and plumbing failures are all common in new apartments and can affect both safety and property value.
- A pre-settlement inspection by an independent qualified building inspector is the most effective way to identify defects before you take ownership.
- NSW buyers benefit from the Strata Building Bond and Inspections Scheme, which holds a 2% construction cost bond for rectification of defects found in the first 18 months.
- Statutory warranty periods across Australian states provide 2 to 6 years of protection depending on the type of defect and the jurisdiction.
- Document every defect with photographs and written descriptions, and submit the list to the developer in writing with a request for a rectification timeline.
- If the developer does not respond, lodge a complaint with your state's building regulator or apply for dispute resolution through the relevant tribunal.
Frequently Asked Questions
QWhat are the most common defects in off-the-plan apartments in Australia?
The most common defects found in off-the-plan apartments are waterproofing failures, structural cracking, fire safety compliance issues, plumbing problems, electrical faults, and cosmetic finishing defects. Waterproofing failures are the single largest category, accounting for approximately 40% of all defects reported in new apartment buildings in NSW. Structural and fire safety defects are less frequent but far more serious in terms of cost and safety implications.
QHow common are building defects in new apartments in Australia?
Research by the UNSW City Futures Research Centre found that up to 85% of apartments built since 2000 in NSW contain at least one significant defect. A 2023 NSW Government study further confirmed that 53% of strata buildings registered between 2016 and 2022 had serious defects. While these figures relate primarily to NSW, similar issues are reported across all Australian states.
QShould I get a building inspection before settling on an off-the-plan apartment?
Yes. An independent pre-settlement building inspection is strongly recommended for any off-the-plan purchase. The inspector will check the apartment against the contract specifications and relevant Australian Standards, identify construction defects, and provide a written report that you can use to request rectification from the developer before settlement. Inspecting before settlement gives you the greatest leverage to have issues fixed.
QWhat is the Strata Building Bond and Inspections Scheme in NSW?
The Strata Building Bond and Inspections Scheme (SBBIS) is a NSW Government initiative under NSW Fair Trading. It requires developers of new strata apartment buildings to lodge a bond equal to 2% of the total construction cost before obtaining an occupation certificate. The bond is held for two years and can be used to pay for defect rectification identified in mandatory inspections conducted within the first 18 months of completion. If no defects are found, the bond is returned to the developer.
QWhat is the defect warranty period for new apartments in NSW?
Under the Home Building Act 1989 (NSW), builders provide a statutory warranty of 2 years for minor defects and 6 years for major structural defects, both measured from the date of completion. Major structural defects include issues that affect the load-bearing capacity of the building or make it unsafe for occupation. Minor defects cover finishing issues, minor leaks, and other non-structural problems.
QWhat should I do if I find defects in my new apartment after settlement?
Document each defect with photographs and a written description. Submit a formal written notice to the developer or builder listing all items and requesting a rectification timeline. If the builder does not respond within a reasonable period, lodge a complaint with your state's building regulator such as NSW Fair Trading, VBA, or QBCC. You can also apply to the relevant tribunal (NCAT in NSW, VCAT in Victoria) for dispute resolution. An independent defect investigation report from a qualified building inspector strengthens your case.
QHow much does it cost to fix waterproofing defects in a new apartment?
Rectifying a failed waterproofing membrane in a bathroom or wet area typically costs $15,000 or more once tiling, fixtures, and cabinetry have been installed. By comparison, the original waterproofing application costs only $300 to $400 per wet area. In multi-storey buildings, water from a failed membrane can travel through the concrete slab and damage the apartment below, significantly increasing the total cost of repairs.
QCan I refuse to settle if there are defects in my off-the-plan apartment?
Whether you can delay or refuse settlement depends on the nature and severity of the defects and the terms of your contract. Minor cosmetic defects typically do not give you the right to refuse settlement but should be documented and reported for rectification. Significant structural defects, safety hazards, or items that materially differ from the contract specifications may give you grounds to delay settlement. Seek legal advice from a property solicitor before making this decision.
QWhat is the difference between a major defect and a minor defect?
A major defect is one that affects the structural integrity of the building, makes it uninhabitable, or creates a safety hazard. Examples include foundation failure, severe structural cracking, and non-compliant fire safety systems. A minor defect is a deficiency in construction that does not affect structural integrity or safety, such as poor paintwork, scratched flooring, or misaligned cabinetry. The distinction matters because warranty periods are longer for major defects in most Australian states.
QAre fire safety defects common in new apartment buildings?
Yes. The NSW Government's 2023 strata defects study found that fire safety defects appeared in approximately 24% of surveyed buildings, making it the second most common defect category after waterproofing. Common fire safety issues include non-compliant cladding, missing fire collars and dampers, gaps in fire-rated assemblies, and defective smoke detection systems. These defects are typically hidden within walls and ceilings, making them difficult to detect without a thorough professional inspection.
QWho is responsible for fixing defects in common areas of a strata building?
During the defect warranty period, the developer or builder is responsible for rectifying defects in common areas. The owners corporation (strata body) should conduct formal inspections of all common property and report defects to the developer in writing. In NSW, the Strata Building Bond and Inspections Scheme provides a financial mechanism to fund common area rectification. After the warranty period expires, the owners corporation becomes responsible for maintenance and repairs, funded through strata levies.
QWhat Australian Standard covers waterproofing in new apartments?
Australian Standard AS 3740 sets out the requirements for waterproofing of domestic wet areas including bathrooms, laundries, and balconies. It specifies which areas must be waterproofed, the minimum membrane performance requirements, and the inspection and testing procedures that must be carried out before finishes are applied. Compliance with AS 3740 is referenced in the National Construction Code and is mandatory for all new residential construction in Australia.
References and Resources
- NSW Building Commission - Research on Serious Building Defects in NSW Strata Communities - NSW Government strata defects research and statistics
- NSW Fair Trading - Strata Building Bond and Inspections Scheme - Defect bond requirements for new apartment buildings in NSW
- NSW Fair Trading - Building Complaints - How NSW Building Commission handles building defect complaints
- ABCB - National Construction Code - Australian Building Codes Board national construction standards
- NSW Legislation - Home Building Act 1989 - Statutory warranties and defect liability periods for residential building work in NSW
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Buying an off-the-plan apartment? Owner Inspections provides independent pre-settlement inspections across NSW, Victoria, and Queensland. Our licensed building inspectors identify construction defects, check compliance with Australian Standards, and deliver a detailed report you can use to request rectification before settlement. Get a quote today or call us on 1300 471 805.