Buying a home in Sydney – whether it’s your first apartment, a house in the suburbs, or a new off-the-plan development – is an exciting journey. But with it comes a flood of unfamiliar terminology, especially when it comes to building and construction. Understanding these terms isn’t just helpful – it’s essential. It could mean the difference between making a wise investment or walking into a financial and structural headache.
Whether you’re attending open homes, reading through building inspection reports, or dealing with builders for a new home, these building terms will empower you to ask the right questions and make informed decisions.
Let’s break it down.
1. DA (Development Application)
In Sydney, most building projects – especially those involving changes to structure or use – require approval from the local council. This is called a Development Application (DA). It includes architectural plans, environmental impacts, and how the development fits into local planning rules.
Tip: Before buying a property with renovation potential, check if your intended work will require a DA – and whether similar applications have been approved in your area.
2. CDC (Complying Development Certificate)
A CDC is an alternative to a DA and is used for fast-tracked, low-impact developments that meet strict planning guidelines. It’s a one-stop approval process managed by private certifiers or councils.
Know the difference: CDC is faster than a DA but not always possible. Your site must meet specific zoning and planning rules.
3. Strata Title
Common in Sydney apartments, strata title means you own your individual unit but share ownership and maintenance responsibilities of common areas (like the foyer, lifts, garden) with other owners.
Important: Always review the strata report before buying. Look for things like sinking fund levels and any upcoming special levies.
4. BASIX Certificate (Building Sustainability Index)
In NSW, any new residential development or significant renovation must include a BASIX Certificate. It ensures the design meets sustainability targets around water, energy efficiency, and thermal comfort.
Why it matters: A BASIX-compliant home will save you money on utilities in the long term – and reduce your environmental footprint.
5. Home Building Compensation Fund (HBCF)
Formerly known as Home Warranty Insurance, the HBCF protects buyers from financial loss due to defective or incomplete residential building work if the builder dies, disappears, becomes insolvent or has their license suspended.
When it applies: Required for work over $20,000 in value. Always ask for proof of HBCF insurance before signing a contract.
6. Building Inspection Report
This is a pre-purchase report that assesses the physical condition of a property. It will highlight issues like cracks, water damage, structural defects, pest infestation, and more.
Must-have: In Sydney’s competitive market, it’s tempting to skip this. Don’t. A detailed report can save you tens of thousands down the track.
7. Certificate of Occupancy / Occupation Certificate
Issued by the local council or private certifier, this certificate confirms that the building is safe and suitable to occupy. It is required before anyone can legally move in.
For new builds: No certificate = not finished or approved. If you’re buying off-the-plan, ask when this will be provided.
8. Defects Liability Period
When you buy a new build, there is usually a defects liability period – typically 12–24 months – where the builder is legally required to fix any issues that arise due to faulty workmanship or materials.
Advice: Keep a record of any defects during this time and report them before the deadline.
9. Setback
A setback is the required distance between your building and the property boundaries (front, sides, and rear). Setbacks ensure access to light, air, and privacy between properties.
Why it matters: You can’t just build to the edge of your block. Always check council rules if planning extensions or new construction.
10. Zoning
Local councils use zoning laws to determine how land can be used – for residential, commercial, industrial, or mixed purposes. Each zone (like R2 for low-density residential) has its own rules around building height, size, and use.
Before you buy: Check the zoning of the property and surrounding land. A quiet area today could change in the future due to rezoning.
11. Footings and Slab
These are the foundations of your home. Footings support the weight of the structure and are poured before the slab (concrete base). In Sydney, where soil conditions vary, proper footings are critical to avoid movement or cracking.
For new builds: Ask for soil reports and footing designs. Some sites may require additional reinforcement (which can be costly).
12. Load-Bearing Wall
A load-bearing wall supports the weight of the structure above it. These can’t be removed without structural engineering and support.
Renovation caution: Always get professional advice before knocking down internal walls.
13. Easement
An easement is a legal right for someone else (like a neighbour or utility company) to use part of your land for a specific purpose – like access or drainage.
Check your title: Easements can limit what and where you can build.
14. R-Value (Insulation)
This measures how well your home resists heat flow. The higher the R-value, the better the insulation. Building codes in NSW require minimum R-values for ceilings, walls, and floors.
Comfort + efficiency: Good insulation reduces your heating/cooling costs and improves year-round comfort.
15. Special Levy (Strata)
In strata schemes, a special levy is a one-off charge imposed on all owners to cover unexpected or large expenses – like repairing structural damage or updating fire safety systems.
Hidden cost alert: Check if any special levies are upcoming or recently raised when reviewing the strata report.
16. Waterproofing Certificate
Waterproofing is critical in wet areas like bathrooms, balconies, and laundries. In NSW, only licensed waterproofers can issue a waterproofing certificate, and it’s mandatory for new builds or major renovations.
Why it matters: Faulty waterproofing is one of the top causes of building defects in Sydney. Ensure it’s done right – and certified.
17. NCAT (NSW Civil and Administrative Tribunal)
If disputes arise between buyers and builders (or strata issues), they often go to NCAT. It’s a legal body that resolves disputes around defective building work, strata schemes, and tenancy.
Recourse: Keep all documents and communication in case of future issues.
Final Thoughts
Buying or building a home in Sydney is one of the biggest financial and emotional commitments you’ll make. Having a solid grasp of these key building terms means you’ll navigate this complex landscape with far more confidence and clarity.
Remember: Don’t be afraid to ask questions. Seek legal and building advice when needed. And take your time – a little knowledge goes a long way in avoiding costly mistakes.
