What is an Owner-Builder?
You are an Owner-Builder if you:
- Have a relevant interest in the land or the building on which the Restricted Building Work is carried out (i.e. ownership), and are an individual (i.e. not a company).
- Live in or are going to live in the home (this includes a holiday home or Bach).
- Carry out the Restricted Building Work to your own home yourself, or with the help of your unpaid friends and family members, and
- Have not, under the Owner-Builder Exemption, carried out Restricted Building Work to any other home within the previous 3 years.
Restricted Building Work
Restricted Building Work is work which is critical to the integrity of a building. It makes sure the building is structurally sound and weathertight, that’s why it can only be done or supervised by tradespeople who are Licensed Building Practitioners (LBPs), or by Owner-Builders who have made a statutory declaration and obtained an Owner-Builder exemption from their Council.
The Building Act 2004 now requires that all Restricted Building Work that is undertaken is clearly identified. This means that there is now a greater accountability for ensuring that the work is ‘built right’. Owner-Builders are not exempt from this.
An Owner-Builder can build their own home or do work on their home that is Restricted Building Work but the Owner-Builder must meet all the statutory requirements. That means that the standard of the work must be to the same level as if it was carried out by a Licensed Building Practitioners (LBP). If you are a suitably skilled owner-builder and meet the criteria of owner-builder, you can carry out restricted building work.
However, if you have any doubts about your design or building knowledge and skill, we strongly advise you employ a licensed building practitioners to do this building work. It is advisable that any owner considering this, checks their level of building knowledge against:
- The competencies required of a Licensed Building Practitioners and MBIE’s building & construction website on occupational licensing).
- The requirements of the building code’s Acceptable Solutions.
Exempt building work
An owner-builder can carry out exempt building work (no building consent needed), but the work must still meet the requirements of the Building Act 2004 and the Building Code. It is the owners’ responsibility to decide if the work requires a building consent. However, it is always wise to discuss your project with an officer at your local Council just to be sure. If a building project does need a building consent and you construct a building without one, this is an offense under the Building Act 2004. This could result in heavy fines. If a building consent is NOT required they will tell you this. Check:
- Schedule 1 of the Building Act 2004.
- MBIE guidance about building work that is exempt from a building consent.
Although a building consent may not be required, the project may still need to get approval from the Council’s planning department with regard to the Council District Plan. Building without planning approval could result in heavy fines (up to $20,000). Check with your local Council – if a resource consent is needed, they will tell you.
Getting an Owner-Builder Exemption
Normally when you apply for a building consent, you would have to declare who the licensed building practitioners are for both the design and construction work. In the case of an owner-builder, you will have to supply a Statutory Declaration (Form 2b) in regard to the restricted building work that you will be responsible for. This could be design and /or construction work. The Statutory Declaration form needs to be given to your local council with your building consent application documentation, or BEFORE the construction of Restricted Building Work on your home starts. The Statutory Declaration form is available from MBIE’s Building System Performance website under Obligations and responsibilities of owner-builders and their building project
The statutory declaration is a complex document that requires building knowledge in order to fill it out correctly. It is also a legally binding declaration that requires witnessing by a Justice of the Peace or by someone else authorised by law to do so (refer to Oaths and Declarations Act 1957, section 9).
The completed Statutory Declaration will be kept on the property file at the Council so that future purchasers of the property know that the work was carried out by an unlicensed builder. It is an offense under the Crimes Act 1961 (Section 111) to give false information in a Statutory Declaration, and it is also an offense under the Building Act 2004 (Section 369) with a fine of up to $5,000.
At building consent application provide the following documents:
- The building consent application form and any other document it requires
- The applicant checklist and any other documents it requires
- The Statutory Declaration (Form 2b) – witnessed by a Justice of the Peace
- The plans and specification of the house to the same level of detail and building code compliance as that required of a licensed designer, architect or engineer
- If the owner-builder chooses to have the building plans drawn up by a licensed designer (a Design LBP, Architect, or Engineer) then the designer must supply the owner with a Certificate of Design Work (COW). This must be submitted with the application for a building consent.
An owner-builder doing the construction work is responsible for ensuring that the construction work is compliant with the approved plans and specifications. This means that the construction work is compliant with the Building Act 2004 and NZ Building Code (Building Act 2004, Section 14C).
Even with a Statutory Declaration, there are some areas of construction that an owner-builder cannot do unless they are licensed. Suitable licensed people must carry out this specialised work. These include:
If the owner-builder chooses to have some aspects of Restricted Building Work carried out by a LBP, they must notify Council of the LBP’s detail PRIOR to construction beginning. Use the LBP Notification form. Upon completion of this work, the LBP must provide the owner with a Record of Work. The Records of Work must be supplied by the Owner to Council at or before the application for CCC. These forms can be found on the Application Forms page.
An Owner-Builder can get help with the design or construction work from friends and family so long as they are not paid for this work. This is included in the requirements of owner-builder status and in the Statutory Declaration.
Changing the Owner-Builder status
The typical scenarios could be:
(i) Stop using the exemption: sometime during construction, the owner-builder decides they don’t want to do the construction work and that they want to employ a Licensed Building Practitioners (LBP) to complete the job.
(ii) Start using the exemption: some way through the construction an owner may decide to terminate the employment of the licensed building practitioner and intends to finish the job themselves as an owner-builder.
(iii) Some way through the job the owner-builder decides to employ a licensed building practitioner carry out particular parts of the construction.
In each situation, you must notify the Council of the changes using the Notice of Owner-Builder (form 2C) before continuing with the construction (under Building Publications, see Applying for and using the exemption at MBIE’s Building System Performance website).
Building other houses
The owner-builder exemption only allows the owner to build a home if they have not carried out restricted building work in relation to a different household unit within the previous 3 years.
Selling an Owner-Builder house
As with other legal documents, the completed Statutory Declaration is kept on the property file for the house being sold. The Declaration not only enables owner builders to do restricted building work they wish to on their homes (or use a family member or friend) but also protects future owners in the event of building failure. As with Licensed Building Practitioners, an owner-builders liability extends to 10 years for workmanship.
Licensed Building Practitioners in the building industry are usually covered to fix defects under warranty from the building organisations they belong to e.g., the Registered Master Builders Federation, and the Certified Builders Association of New Zealand. These organisations have, by mutual agreement, agreed to stand behind the quality of the workmanship of their members. If an Owner-Builder does not belong to either of these, it is unlikely that they will be able to obtain insurances and sureties for this work in the current insurance market.
If an Owner-Builder has retired from the building industry, it would be wise to ask who is providing the unexpired portion of the warranty. For instance, it may have been transferred to another building contractor or to a third-party warranty or surety plan provider. This would give the purchaser the added assurance that any problems will be fixed even if the builder is no longer around, if for example he or she has died, or gone out of business. It would be wise for purchasers to check if the building work is covered by existing warranty providers.
For more information
- Building regulatory framework
- Building work for which building consent
- DIY, but build it right
- DIY on the LBP site.
- Homeowner rights and obligations
- Regulatory impact statements
- Building Act 2004
- Schedule 1 Building work for which building consent not required
- Section 14C Responsibilities of owner-builder
- Section 87A Notices to BCA when owner-builder carries out RBW
- Section 90A – 90D Restricted building work carried out by owner-builders
- Section 369 Offence to make false or misleading statement
- Building Regulations 1992 – Building Code
- Crimes Act 1961 – Section 111 False statement or declaration
- Oaths and Declarations Act 1957 – Section 9 – Declarations made in New Zealand