Ensuring Strata Building Bond Compliance for Your Apartment Building
The Strata Building Bond serves as a financial safety net designed to cover building defects in apartment complexes. Compliance with this bond is crucial for ensuring both the safety and the value of your property. The objective of this guide is to navigate apartment owners through the process of achieving Strata Building Bond compliance.
What is Strata Building Bond?
A Strata Building Bond is a mandated security deposit required from property developers before they can obtain an occupation certificate for a new strata scheme. Under the Strata Building Bond and Inspections Scheme (SBBIS), this bond is particularly significant for new apartment buildings that are 4 storeys or higher.
Developers must pay a bond to NSW Fair Trading equal to 2% of the total contract price for the building. This bond is not a mere procedural step. It serves to protect apartment owners by providing a dedicated fund for rectifying any construction defects identified after the building is complete and occupied.
Additionally, it incentivizes developers to adhere to high-quality construction standards, as the bond is refundable if no defects are found. Therefore, the Strata Building Bond acts as both a financial safety net for owners and a quality assurance mechanism for new strata buildings.