Unapproved Structures in Western Australia: Protecting Your Investment in the REIWA Contract
1. Plain English Definition
"Unapproved Structures" means any building, extension, renovation, or modification on a property that was constructed without the necessary permits and approvals from the relevant local council in Western Australia. This includes additions like patios, carports, sheds, or even internal renovations that required council consent but didn't receive it, making them non-compliant with local planning and building regulations.
2. The Danger Zone: Buyer's Risk
- Financial Penalties: You could face significant fines from local councils (e.g., City of Perth, City of Joondalup) for non-compliant structures, potentially thousands of dollars, to either demolish or regularise the unapproved work.
- Demolition Orders: The local council in Western Australia can issue an order requiring you, as the new owner, to demolish the unapproved structure at your own expense if it cannot be brought to code.
- Delayed Settlement: Discovering unapproved structures during pre-settlement inspections can complicate the REIWA Contract, potentially delaying settlement while the issue is negotiated or resolved, causing extra costs for both parties.
- Insurance Issues: Home insurance policies may not cover damages to or caused by unapproved structures, leaving you exposed to significant repair or rebuild costs.
- Difficulty Reselling: Future buyers may be hesitant or unable to secure finance for a property with unapproved structures, impacting your ability to sell the property down the line.
- Legal Liability: In some cases, you could be held liable for safety hazards or structural issues arising from poorly constructed unapproved works, particularly if they do not meet Western Australia's building codes.
- Regularisation Costs: The process of obtaining retrospective approval can be complex and expensive, involving engineering reports, revised plans, and council fees, often costing thousands of dollars and taking many months.
4. Real-Life Western Australia Scenario
Li Wei, an investor from Shanghai looking for his first Western Australia property in Canning Vale, purchased a house using the REIWA Contract. After settlement, he discovered the large rear patio and converted garage were built without council approval, a fact missed during his pre-purchase checks. The local council issued an order for the structures to be regularised or removed. Li Wei faced over $15,000 in fees for retrospective planning applications, engineering reports, and remedial work to bring the patio to code, plus delays in renting out the property. Always conduct thorough due diligence and council checks before signing a Western Australia property contract to avoid this buyer's risk.