Dilapidation risks in Melbourne's construction boom refer to the potential for nearby construction work to damage existing buildings and infrastructure. Managing these risks requires pre-construction dilapidation surveys, compliance with Part 7 of the Building Act 1993 (VIC), clear communication with neighbours, and ongoing monitoring throughout the build. A professional dilapidation report documents the condition of surrounding properties before work begins, creating a baseline that protects both developers and property owners from costly disputes.
Melbourne's property market continues to grow, with new residential and commercial projects reshaping suburbs across the city. While this growth brings opportunity, it also increases the chance of construction activity causing cracks, vibration damage, settlement, and other structural impacts on neighbouring properties. For developers, builders, and homeowners, understanding how to manage dilapidation risks is not optional. It is a legal and practical requirement.
What Are Dilapidation Risks?
Dilapidation risks describe the possibility of damage to existing buildings and structures caused by nearby construction activity. This can include cracking to walls and ceilings, foundation settlement, damage to driveways and fencing, and disruption to underground services such as plumbing and drainage.
These risks affect both new development sites and the older properties surrounding them. When heavy machinery operates nearby, when excavation alters soil conditions, or when piling sends vibrations through the ground, adjacent properties can suffer measurable harm.
The term "dilapidation" in the construction context refers specifically to damage or deterioration caused by building works, not general wear and tear over time.
Why Melbourne's Construction Boom Increases the Risk
Melbourne has experienced sustained population growth and housing demand for over a decade. According to the Australian Bureau of Statistics, Victoria approved over 60,000 new dwellings in the 2023 to 2024 financial year, with a large share concentrated in Melbourne's inner and middle suburbs.
This density of construction activity means more projects are happening on smaller lots, closer to existing buildings, and often involving deep excavation or demolition of older structures. The result is a higher likelihood of neighbouring properties being affected.
- Infill development on narrow lots places construction equipment within metres of existing walls
- Basement excavation for apartments and townhouses alters groundwater and soil stability
- Demolition of older homes sends vibrations through shared footings and party walls
- High-rise projects in established suburbs introduce piling and crane operations near heritage buildings
Legal Responsibilities Under the Building Act 1993
In Victoria, Part 7 of the Building Act 1993 sets out clear obligations for anyone undertaking building work that may affect adjoining properties. This legislation is designed to protect neighbouring owners from construction-related damage.
Under this legislation, the building owner must:
- Give written notice to adjoining property owners before work begins
- Provide at least 24 hours' notice before commencing any work that could affect neighbouring properties
- Take reasonable steps to prevent damage to adjacent buildings
- Be liable for any damage caused to neighbouring properties as a result of the construction
Failure to comply can result in fines, stop-work orders, and liability for all repair costs to damaged properties. The Victorian Building Authority (VBA) oversees enforcement of these provisions.
Ignoring your obligations under Part 7 of the Building Act 1993 can lead to significant financial penalties and personal liability for damage to neighbouring properties. It is far cheaper to commission a dilapidation survey than to defend a damage claim in VCAT.
The Role of Dilapidation Surveys
A dilapidation survey is a detailed inspection and photographic record of the condition of neighbouring properties before construction begins. It creates a legally defensible baseline that shows exactly what condition the surrounding buildings were in prior to any work starting.
This baseline is used to:
- Compare pre-construction and post-construction conditions
- Identify whether any new damage was caused by the building works
- Protect developers and builders against false or exaggerated damage claims
- Provide evidence in insurance claims or VCAT disputes
Without a dilapidation report, it becomes extremely difficult to prove whether damage existed before the project started or was caused by the construction.
What a Dilapidation Survey Covers
A thorough dilapidation survey inspects and records the current condition of all elements that could be affected by nearby construction. The scope depends on the type and scale of the proposed works.
| What Is Inspected | Why It Matters | |
|---|---|---|
| External Walls | Brickwork, render, cladding, mortar joints, visible cracking | Walls are the most common area to show vibration and settlement damage |
| Foundations and Footings | Visible foundation lines, stumps, slab edges, sub-floor access points | Excavation and piling can alter soil pressure and cause differential settlement |
| Roofing and Gutters | Tiles, flashing, guttering, downpipes, fascia boards | Vibration from heavy machinery can dislodge tiles and crack flashings |
| Driveways and Paths | Concrete slabs, pavers, retaining walls, fences, gates | Ground movement from excavation frequently causes cracking in hard surfaces |
| Internal Areas | Ceilings, cornices, internal walls, floors, doors and windows | Internal cracking and door/window misalignment indicate structural movement |
Best Practices for Managing Dilapidation Risks
Managing dilapidation risks well requires action before, during, and after construction. The following steps help developers, builders, and homeowners stay compliant and avoid disputes.
Before Construction
Commission a dilapidation survey
Engage a qualified building inspector to survey all neighbouring properties before any work begins. This report becomes your baseline evidence.
Notify adjoining owners in writing
Under the Building Act 1993, you must give written notice to all neighbouring owners. Include the scope of work, expected start date, and duration of the project.
Hold a pre-construction meeting
Invite neighbours to discuss the project, answer questions, and provide your contact details. Open communication reduces the chance of disputes later.
Review your insurance coverage
Confirm your public liability and construction insurance covers damage to third-party properties. Check the policy limits and exclusions.
During Construction
- Monitor adjacent properties for new cracking, movement, or damage at regular intervals
- Use vibration monitoring equipment when piling, demolishing, or using heavy plant near boundaries
- Keep a site diary recording all activities, equipment used, and any incidents
- Respond promptly to any neighbour complaints and document your response
After Construction
- Commission a post-construction dilapidation survey to compare against the baseline
- Address any confirmed damage promptly and in good faith
- Retain all survey reports, correspondence, and monitoring records for at least seven years
Technology in Modern Dilapidation Assessments
Modern dilapidation surveys have moved well beyond simple written notes and photographs. Today's inspectors use advanced tools that improve accuracy, speed, and the quality of evidence collected.
- Drone technology allows aerial inspection of roofs, gutters, and upper-level facades without scaffolding
- 3D laser scanning creates precise digital models of building surfaces, capturing measurements to millimetre accuracy
- High-resolution photography with metadata tagging provides timestamped, geolocated evidence
- Vibration monitoring devices track ground movement in real time during construction
- Thermal imaging can detect moisture ingress and hidden structural issues behind walls
These technologies strengthen the evidentiary value of a dilapidation report and make it far more difficult for any party to dispute the findings.
Common Types of Construction-Related Damage
Understanding the types of damage that construction can cause helps property owners recognise problems early and take action.
| Description | Common Cause | |
|---|---|---|
| Cracking | Hairline to structural cracks in walls, ceilings, and floors | Vibration from demolition, piling, or heavy machinery |
| Settlement | Uneven sinking of foundations causing doors to stick and floors to slope | Excavation altering soil pressure or groundwater levels |
| Water Ingress | Moisture entering through new gaps, cracks, or displaced flashings | Vibration dislodging roof tiles, damaging waterproof membranes |
| Fence and Boundary Damage | Leaning, cracked, or collapsed fencing and retaining walls | Excavation near boundary lines and heavy vehicle movement |
| Service Disruption | Broken pipes, damaged cables, or blocked drainage | Excavation cutting through underground services |
Key Takeaways
- Melbourne's construction boom significantly increases dilapidation risks to neighbouring properties from excavation, demolition, and heavy machinery.
- Part 7 of the Building Act 1993 (VIC) requires builders to notify neighbours and take reasonable steps to prevent damage.
- A pre-construction dilapidation survey creates a legally defensible baseline of property conditions.
- Both developers and neighbouring property owners benefit from professional dilapidation reports.
- Modern technologies including drones, 3D laser scanning, and vibration monitors improve the accuracy of assessments.
- Post-construction surveys should be conducted to compare against the pre-construction baseline and identify any new damage.
- Failure to manage dilapidation risks can result in fines, stop-work orders, and liability for repair costs.
- Open communication with neighbours before and during construction reduces the likelihood of disputes.
Frequently Asked Questions
QWhat is a dilapidation survey and why do I need one in Melbourne?
A dilapidation survey is a detailed inspection that documents the existing condition of neighbouring properties before construction begins. In Melbourne, where the volume of construction activity is high, these surveys create a baseline record that protects both the developer and the adjoining property owners. If damage occurs during the build, the survey provides clear evidence of what existed beforehand.
QIs a dilapidation report legally required in Victoria?
While a dilapidation report itself is not explicitly mandated by legislation, Part 7 of the Building Act 1993 requires you to prevent damage to adjoining properties and to notify neighbours of your building works. A dilapidation survey is the most effective way to demonstrate compliance with these obligations. Many councils and building surveyors in Melbourne will require one as a condition of the building permit.
QWho pays for the dilapidation survey?
The party undertaking the construction work typically covers the cost of the dilapidation survey. It is considered part of managing the project's impact on surrounding properties and is a standard project expense for responsible builders and developers.
QHow much does a dilapidation survey cost in Melbourne?
Costs vary depending on the number of adjoining properties, property size, and scope of the inspection. For a standard residential dilapidation survey covering two to three neighbouring properties, expect to pay between $600 and $1,500 in Melbourne. Larger commercial or multi-property surveys can cost more. Contact a licensed building inspector for a specific quote.
QHow long does a dilapidation survey take?
The on-site inspection typically takes between two and six hours depending on the number of properties and their size. The final report, including photographs and detailed condition notes, is usually delivered within three to five business days.
QCan I dispute a dilapidation report if I think it is inaccurate?
Yes. If you believe a dilapidation report does not accurately reflect the condition of your property, you can raise this with the surveyor directly. If the issue is not resolved, you may commission your own independent report from a different inspector for comparison. In the event of a dispute, VCAT can consider evidence from both reports.
QWhat happens if construction damages my property and there was no dilapidation survey?
Without a pre-construction dilapidation survey, it is much harder to prove that the damage was caused by the building works. You may still make a claim, but the lack of baseline evidence weakens your position significantly. The builder or developer could argue the damage pre-existed the construction.
QShould I get a dilapidation survey if I am the neighbouring property owner?
Yes. Even though the builder or developer typically arranges the survey, you have every right to commission your own independent dilapidation report. This gives you your own baseline evidence in case any damage occurs during the construction. It is a relatively small investment compared to the cost of repairing structural damage.
QWhat qualifications should a dilapidation surveyor have?
A dilapidation surveyor should hold relevant qualifications in building inspection, building surveying, or structural engineering. In Victoria, they should be registered or licensed through the Victorian Building Authority (VBA). Look for professionals with specific experience in dilapidation assessments and a strong track record in Melbourne's construction sector.
QHow often should dilapidation surveys be conducted during a long project?
For longer projects, it is recommended to conduct the initial survey before work begins and a final survey after completion. For projects lasting more than six months or involving staged works such as demolition followed by excavation and then construction, interim surveys at each major stage provide better protection and more detailed evidence of any progressive changes.
References and Resources
- Victorian Building Authority (VBA) - Regulator for building and plumbing in Victoria
- Building Act 1993 (VIC) - Victorian legislation governing building works and adjoining property protections
- Australian Bureau of Statistics - Building Approvals - Data on dwelling approvals in Victoria
- Victorian Civil and Administrative Tribunal (VCAT) - Dispute resolution for building and property matters in Victoria
Related Articles
Ultimate Guide to Dilapidation Reports
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What to Expect from a Professional Dilapidation Report
A professional dilapidation report documents the existing condition of neighbouring properties before construction begins. It records cracks, settling, water damage, and other defects with detailed descriptions and high-quality photographs. This guide explains what the report covers, how the inspection works, and what to look for when choosing an inspector.
Council Requirement for Dilapidation Reports
Australian local councils mandate dilapidation reports before construction to protect neighbouring properties and public infrastructure. Requirements vary by jurisdiction, with urban councils in Sydney and Melbourne enforcing stricter standards. This guide explains when reports are required, who can prepare them, and what happens if you skip this step.
Planning a construction project in Melbourne or concerned about nearby building works? Owner Inspections provides professional dilapidation surveys across Melbourne and Victoria. Our licensed inspectors use the latest technology to create comprehensive baseline reports that protect your interests. Get a quote today or call us on 1300 471 805.