Stage 1 of the Strata Building Bond and Inspections Scheme is for the developer of a new residential strata building (4 storeys or higher) to lodge a building bond in the form of a bank guarantee with NSW Fair Trading. This is required prior to obtaining the Occupation Certificate (OC) for the project.
The bond amount is 2% of the contract price. Where a contract is not in place or the developer and builder are connected, then the contract price must be determined by a quantity surveyor based on the as-built documentation.
The first step is for the developer to obtain a project number from Fair Trading. As this takes time it will save any unnecessary delays as this number is needed for the bank guarantee.
After the number is obtained then there is an extensive list of documents needed to be uploaded to complete the application.
The developer must provide a copy of all project documents in the versions available at the time just prior to the application for OC. A summarised list of documents are:
- Quantity surveyors report (includes the bank guarantee)
- Issued for construction and as-built drawings and specifications, including any associated design certificates
- Written warranties
- Schedule of samples
- Development consent, modifications of consent and construction certificates
- Consultants reports
- Pay application fee of $1500
The response from Fair Trading will take 10 business days. Fair Trading also has a host of materials that can be assist with the application and can be found via this link: https://www.fairtrading.nsw.gov.au/housing-and-property/strata-building-bond-and-inspections-scheme
The next stage will be explained in the blog post to follow.