What actually happens at a practical completion inspection in NSW?

9 min read | Build Compass team | buildcompass.com.au

You've spent months, sometimes years watching your home being built. Now you're standing outside on handover day, key in hand, about to sign the practical completion form. Before you do, there's one critical step that most homeowners either rush through or skip entirely: the practical completion inspection.

This guide explains exactly what a PC inspection is, what happens during one, and how to use it to protect your rights under NSW law.

What is practical completion?

In NSW, 'practical completion' is the point at which your builder declares the work substantially complete in accordance with your contract and approved documentation either CDC Stamped plans or CC Stamped Plans. It doesn't mean the home is perfect, it means it's ready for you to occupy. Minor defects can still exist at practical completion, but the key word is 'minor.'

Once you sign the practical completion certificate, the clock starts on your defects liability period (typically 90 days under a standard HIA or MBA contract) and on your statutory warranty period under the Home Building Act 1989 (NSW). Signing without documenting defects can significantly weaken your ability to have them rectified later.

What happens at the walkthrough?

The practical completion inspection commonly called the PC inspection or handover walkthrough is a room-by-room check of the finished home conducted jointly by you (or your representative) and the builder's supervisor. It usually takes 2–4 hours for a standard new home.

The purpose is twofold: you're checking that the work has been done to the standard required by your contract and by the relevant Australian Standards NCC and approved plans, and you're creating a written record of any defects that exist at the time of handover.

What should you be looking for?

Most homeowners focus on visible cosmetic issues, paint marks, scratched surfaces, missing door handles. These matter, but they're the easy ones. The defects that cause the most serious problems are the ones that aren't immediately obvious. Here's where to focus your attention:

1. Waterproofing in wet areas

Water damage from failed waterproofing is one of the most expensive and disruptive defects a homeowner can face. At PC inspection, ask the builder for the waterproofing compliance certificate. It's legally required in NSW for all wet areas under the Building Code of Australia and AS 3740. Tap every wall tile in the shower with your knuckle. A hollow sound means the tile isn't bonded. Check every silicone corner joint for continuity. Run the shower and watch whether the floor drains cleanly without any pooling.

2. Tiled floors (listen for hollow tiles)

Walk slowly across every tiled floor and tap as you go. Hollow tiles aren't just a cosmetic issue. They indicate a bonding failure that will eventually cause cracking and lifting. Under the NSW Guide to Standards and Tolerances 2017 (GST 2017), tiles must comply with AS 3958.1 and hollow tiles are defective at handover.

3. Plasterboard finish and cracks

The default plasterboard finish under the GST 2017 (S10.13) is a Level 4 finish all joints taped, minimum two coats of jointing compound, free of tool marks and ridges. Any cracks in plasterboard that are visible from 1.5 metres in normal lighting are defective at handover. Look along walls from an angle with natural light crossing the surface, imperfections that look fine head-on become obvious when you change your viewing angle.

4. All doors and windows

Open every single door and window in the home. Every one. They should open and close without binding or sticking. The clearance gap between a door leaf and its frame should be even between 2mm and 5mm all the way around. Any door that binds or jams within three months of completion is defective under GST 2017 S9.7.

5. Site drainage

Pour a small bottle of water near the building's foundations and watch where it flows. Under NCC Part 3.3 and GST 2017 S1.3, the ground must drain away from the building, not towards it. Pooling against the house can cause long-term foundation and damp issues.

What documents should you receive at handover?

Before you sign anything, confirm that the following are in your handover folder:

• Waterproofing compliance certificate (mandatory in NSW, AS 3740)

• Certificate of Compliance for Electrical Work (CCEW) from the licensed electrician

• Roofing and gutter

• Compliance with BASIX requirements

• Insulation installation

• Condensation management

• Plumbing certificate of compliance from the licensed plumber/drainer

• All appliance manuals and warranty cards

• Occupation Certificate issued by your certifier, not the builder

• Keys, garage remotes and access devices (full set as per contract)

Just to name a few your principal certifier (PC) should of also given you a list of certificates required as part of your construction certificate documentation prior to them issuing an occupation certificate.

Should you do the inspection yourself?

You can conduct your own PC inspection using a structured checklist, our Practical Completion Defect Checklist is designed exactly for this purpose, with descriptions of what to look for at every point of the home.

However, if your build involved complex trades, custom details, or significant contract value, engaging an independent building consultant to conduct or attend the PC inspection gives you several advantages: they know what to look for beyond cosmetic issues, they can reference Australian Standards and the NCC precisely when noting defects, and their written report carries more weight if a dispute arises. We have a vast network of industry leaders across sydney get in touch with us to point you in the right directions as picking the correct inspector can save thousands and months of delays if any issue arise

What happens if you find defects?

List every defect clearly and specifically on a defects schedule. Be precise, not "bathroom issue" but "shower floor tile not draining water pools in south-east corner approximately 150mm from waste." Give this to the builder in writing at the end of the inspection and ask them to sign it as acknowledgement of receipt.

Under standard NSW building contracts, the builder has a defined period (typically 90 days) to rectify defects listed at practical completion. You do not have to accept a home with critical defects you can decline to sign until they are resolved, or sign with a written agreement that specific defects will be rectified within an agreed timeframe. thisis cruicial if you are going ot sign with defects oustanding as this is the hardest time to get a builder back.

THE KEY RULE

Do not sign the practical completion certificate until you are satisfied with the inspection outcome. Once signed, you have formally accepted the home in its current condition. This does not remove your statutory warranty rights, but it does make defect disputes harder to resolve.

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