From Owner Builder to Licensed Builder

Must be very different in your state. I have looked into this in NSW previously, first you needed a specific trade (generally it was carpentry or brick laying) and to get any trade here it was a minimum of 20 hours per week over a 3 or 4 year apprenticeship. After that it was 2 years working under a licensed builder.

There was absolutely no pathway into trade, little own building, for mature age people who needed to still be working another fulltime job.

Your comment about the Masters degree helping to get the builders licence concerns me, have you made any enquires with the apprenticeship board etc. to find out what is required?

 

I've seen the same thing in my almost 49 years in the industry Scott No Mates.I think just reflecting quickly that I would almost be able to count on one hand the amount of site managers,project managers,etc who you would say have been very good and efficient at their job.And if one of the foremen,sub-foremen,etc,have the knack of developing a good working relationship with us (the subbies)he seemed to be frowned upon by the ones above him.Management (onsite at least) these days in the game is almost always confrontational in my experience and they seem to almost worry if the job is going smoothly and trouble free.They also always want full credit for your efforts of course.I'm not sure why it has come to this but one train of thought suggests that training future management in Uni's rather than on the shop floor (sites)is a big problem.Of course they need to learn computer programs,etc,these days but that shouldn't be the main focus of been a building manager.Can be a real problem when young people arrive on site with their degrees,no real knowledge,often an ordinary attitude,and are let loose.ha,ha.Anyway,what can you do?We decided years ago to supplement our sub-contract bricklaying with building a few spec homes,units etc,and we have found that has been more lucrative than the tradework over time and now at my age (63)I'm happy just to work on our own projects (duplex at Coffs Harbour at the moment)and do a bit of cottage work in between.I won't be venturing onto any commercial sites and won't miss them at all.

 

Why not start the company WITH a qualified builder rather than becoming a builder yourself. You said you've got the white collar skills to make it work, why dirty your button up shirt?

Someone above said find an older guy who wants to impart his wisdom and knowledge to a protege.

From everything I have heard from my father in law ( builder of 30 years) it's tough to get into unless you have a trade background.

Recognise your weakness: you aren't a tradey

Leverage your strength: you understand business management and marketing

 

Tom

Tom, problem with that is sooner or later most partnerships break…Or If I hire a builder to work in my company then I am at risk when he leaves. Its like if you open a restaurant yous should be a cook. If you hire a cook, he can leave you any time and then when you hire a new one, quality might be different > eventually you start lossing customers or unless you agree with every wish of the chef.

I am willing to work with an older guy for the first few (5) years or atleast thats the plan.

 

What you are really talking about is starting a new career, not just getting a builders registration

The reality is it will take 5-10 years to achieve your goal, and I would lean more towards the 10 year mark.

 

We have a crisis with housing affordability. So we should get more housing supply in to the market. I can’t understand why there are all unnecessary restrictions on owner builders especially in states like NSW. Why can’t an owner builder build more than one house in 5 years?

Houses whether it was built by owner builder or by a builder has to go through the same quality checks. I agree, the owner builder may be making some profit by managing his/her project. I have seen few owner builders completing brand new quality homes in less than 6 months. I have also have seen plenty of rip-offs from the so called builders.

 

Because it is governed by an act of parliament which regulates the operation of builders who carry out work on a commercial basis providing warranties and employing workers.

The average homeowner moves every 7-10 years, is there a demonstrable need to provide more frequent OB licences?

 

I have seen most of the owner builders are employing workers. They only project manage the job. During the recent Sydney boom, many of my friends bought land and owner built many homes. They are now turning away from further development as they can’t see margins if they have to engage a builder. I totally agree they are looking to make some money here but no doubt every new home built will increase supply.

 

So let let anyone get into electrical, plumbing, or car repairs for that matter ? Things are bad enough with the measures in place now, no need for a free for all.

If your friends did multiples looking for profit, then they are shonk, unlicensed builders, aren't they ?

 

OB do not employ any workers - they have to subcontract all trades otherwise they would be unlicenced builders and in breach of their OB licence conditions. Your friends are OB, they are fringe developers as they are building to on-sell at a profit (& ducking their warranty obligations) they have no intention to live in the property. Where does a purchaser of on owner-built house go if there are defects and the OB has moved on?

How many apprentices do OB nationwide employ annually? Same number as last year and every year before that - NIL. What contribution to the building industry does the OB provide by way of training to the next generation of trades? Diddly squat.

The solution to a housing shortage is not just 'remove builder licensing'. Available land for development (freestanding houses) is some distance from the CBD & jobs. Services need to be provided to these sites (paid upfront buy developers). Location is not desirable to FHB too far, not near transport, no jobs, no smashed avo cafes nearby. Brownfield sites are too expensive for FHB (pull your head out of your @rts and buy what you can afford, not what you want).

(Rant off)

 

In Victoria, an owner builder is obligated to provide warranty insurance for the same length of time as a licensed builder. This is an obligation even if they sell the property.

For example, if I owner built a house and sold it immediately I would be liable for the entire 6.5 or so years.

If I sold after five years, I would be liable for the remaining 1.5 years.

There are companies that provide this type of insurance and it is usually taken out by the owner builder at the time of sale.

 

@Joynz - similar applies in most states. However, it is not easy to claim on HOW insurance - IIRC: death of builder, bankruptcy of builder or breakdown of any communication by the builder (probably a few others). That does not sound like insurance in my book.

 

Home | DBI

The insurance owner builders must take out in Vic (on selling a property) covers a purchaser for defects relating to the building.

These include both structural and non structural defects just as licensed builders are required to provide. Also covers a number of other issues.

If you don t sell within the 6.5 years, then it is not required.

 

Contractors are also workers

After seeing some of the builder quotes, it is safe to assume some of the builders overhead is around 25-30% for just engaging the sub contractors and project managing.

In that case a house built by owner builder could be sold 20% under market value. Totally agree, you may have some issues like insurances etc. That is the risk the buyer has to be aware of for discounted homes.

A clever buyer may also demand contact details of major sub contractors(like slab, carpenter, plumber, waterproofer etc) used in an OB.

 

No need for the buyer to keep details of the tradies because if there are any defects within the warranty period, you, as the builder, must fix them.

'Just' engaging contractors? It's a bit more complicated than that.

 

Well, in Sydney, the Bankstown LGA for starters, there is piles and piles of shonk built, poor built, corners cut everywhere, and of course, many doing this are recent arrivals who are used to scamming etc, and gee, what a co incidence they use people who just about pass anything.

They were doing what your talking about, they are shonks.

Sorry, this is not the answer.

By all means, build your own home and save the money, but do not try and be a quasi builder, and I doubt they do anything besides try and sell for top dollar, so they can then repeat & is probably well sub the worst large project builder. The only real benefit is for the shonk themselves.

 

What quality checks does a build by either a builder or OB go through?

Tools

 

Have you built a house as an O/B in the past 5 years?

 

In Victoria - building inspections at standard stages by the building surveyor (slab pour, frame up etc).

Plus private building inspections if the owner hires an independent inspector.

 

Building inspections are not quality checks. They are for compliance.

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