The Section 137B Owner Builders Report Explained

You’ve poured your heart, sweat, and maybe a few tears into building or renovating your home. The job is done, and it looks fantastic. Now, you’re ready to sell and move on to the next chapter. But before you pop the champagne, there’s a critical piece of paperwork you can’t afford to ignore: the Section 137B Owner Builders Report.

This isn’t just bureaucratic red tape; it’s a legal safeguard designed to protect both you and your buyer. Think of it as a professional ‘health check’ for the work you’ve done, giving potential buyers confidence and ensuring your sale goes through without a hitch. Getting this report is a small step that prevents big headaches later on.

This guide will walk you through exactly what a Section 137B Owner Builders Report is, why you need it, and how to get one, so you can sell your property smoothly and with complete peace of mind.

What Exactly is a Section 137B Owner Builders Report?

A Section 137B Owner Builders Report is a specific inspection document required under Victoria’s Building Act 1993. Its main job is to identify and disclose any building defects so that buyers have a clear picture of the property’s condition before they sign on the dotted line. This transparency helps reduce the risk of ugly surprises and disputes after the sale is final.

The report is specifically for work carried out by an owner-builder. This could be anything from major extensions and renovations to smaller projects like:

• Garages and carports
• Kitchens and Bathrooms
• Renovations
• Verandahs and pergolas (AIC VIC)

As mentioned, you must provide this report if you’re selling within 6 years and 6 months of completing the work. This applies no matter how much the work cost. However, if your project’s value topped $16,000, you also need to take out special warranty insurance, which we’ll cover in the Costs and Insurance section below.

Because this report is a legal document attached to your Section 32 Vendor Statement, it has to be prepared by a Registered Building Inspector. 

They must be completely independent from you to ensure their findings are objective and fair. Your mate Dave who’s “good on the tools” won’t cut it for this one!

What’s Inside the Report?

A good Section 137B Owner Builders Report gives you a clear, easy-to-follow breakdown of your building work. It’s a detailed snapshot of what was built, how it was built, and whether it stacks up against the required standards.

Here’s a look at what you can expect to find inside:

Section of the Report	What It Includes
Description of Works	A detailed list of the construction or renovation that was done, including the types of materials used.
Defect Identification	A record of every noticeable issue, from minor cosmetic cracks to major structural problems that could affect safety or need serious repairs.
Photographic Evidence	Clear photos that show you exactly what the inspector saw, making it easy to understand each finding. You can see examples in reports from services like Owner Inspections.
Compliance Assessment	A check to see if the work meets all relevant Australian building codes and regulations, as detailed by inspectors like Force Building Inspections.
Incomplete Works	If any part of the project is unfinished, it will be noted so there are no surprises for the buyer.
Supporting Documents	Where applicable, copies of the Building Permit, Occupancy Permit, or Certificate of Final Inspection are included.

The goal is to provide a complete picture of the property’s structural health, so everyone can move forward with confidence.

The Legal Side: What Happens If You Skip It?

Failing to provide a Section 137B Owner Builders Report when you’re legally required to isn’t something you can just sweep under the rug. It’s a direct violation of the Building Act 1993 (Victoria), and it can land you in some serious hot water.

Consequences of Non-Compliance

If you don’t get the report, you could be looking at:

• Civil penalties for not disclosing building defects.
• Contract disputes if the buyer discovers problems after the sale.
• Major delays or even cancellation of the property sale while legal issues are sorted out.
• A serious blow to your credibility as a seller.

These aren’t just empty threats. A missing report is a valid reason for a buyer to pull out of a contract, leaving you back at square one.

Impact on Your Property Sale

A Section 137B Owner Builders Report is a key part of Victoria’s property disclosure process. 

A clean, professionally prepared report shows you’re being upfront and can build trust with potential buyers, often leading to smoother negotiations.

On the other hand, if the report does highlight some defects, it gives you a chance to address them head-on. You can either fix them before the sale or negotiate the price accordingly. Being transparent from the start is almost always better than dealing with a messy dispute down the track.

Selling a home you built or renovated as an owner-builder? We can tell you whether you need a 137B report and warranty insurance before your agent prepares the contract, so the paperwork does not hold up your sale. Ask us below or call (03) 9646 5913.

Buying a home an owner-builder worked on? The 137B report and any warranty insurance certificate should be attached to the Section 32. Send us the contract and we will review it free within 24 hours. Get your free contract review.

Costs, Insurance, and When You Don’t Need a Report

How Much Does a Section 137B Owner Builders Report Cost?

In Melbourne, the cost for a Section 137B Owner Builders Report typically falls between $300 and $800 for a standard home. The final price depends on the size of your property, the scope of the work being inspected, and the overall complexity of the job.

If your property is large or the renovations were extensive, the inspector will need more time, which will increase the fee. Needing a report in a hurry might also cost you a little extra.

Owner Builder Warranty Insurance

This is a big one. If the value of your owner-builder work was more than $16,000, you are legally required to take out Owner Builder Warranty Insurance. This policy protects the future owner if certain defects pop up after they’ve bought the place.

The insurance generally covers:

• 6 years for structural defects
• 2 years for non-structural defects

When you sell, you’ll need to provide both the Section 137B Owner Builders Report and proof of this insurance in your sales documents.

Are There Any Exemptions?

Yes! You don’t always need a Section 137B Owner Builders Report. You might be exempt if your situation fits one of the following scenarios.

You DO NOT need a report if…	You DO need a report if…
The building work was completed more than 6 years and 6 months ago.	You are selling within the 6-year, 6-month timeframe.
The work was done by a registered builder (not you as an owner-builder).	You acted as the owner-builder for the works.
Your situation meets a specific legal exception under Victoria’s Building Regulations.	The work required a building permit and doesn’t fall under any other specific exemption.

Its always a good idea to double-check your dates and records before booking an inspection – you might find you don’t need one after all.

A Step-by-Step Guide to Getting Your Report

Getting your Section 137B Owner Builders Report is a straightforward process. Here’s how it works.

1. Check if You Need One
   First things first confirm that your sale requires a report. As we’ve covered, this applies if you did owner-builder works within the last 6 years and 6 months that needed a building permit. If you’re not sure, your conveyancer can help clarify.
2. Hire a Registered Building Practitioner
   Only a qualified professional recognised by the Victorian Building Authority (VBA) can prepare the report. This could be a building surveyor, an architect, or an engineer. Their accreditation is your guarantee that the report will meet all legal standards.
3. Get Your Paperwork Ready
   To help the inspector, gather all your building-related documents, including:
   • Building permits
   • Approved plans and drawings
   • Certificate of Final Inspection or Occupancy Permit
   • Any warranty or insurance documents for the work
4. The On-Site Inspection
   The practitioner will visit your property to inspect the work. They’ll be looking for defects, incomplete areas, or anything that doesn’t comply with building standards, and they’ll document the overall condition.
5. The Report is Prepared
   The inspector will compile their findings into the official Section 137B report. It will detail the works, the completion date, and any defects found, usually with photos to provide clear evidence.
6. Attach it to Your Section 32
   Once you have the final report, it must be included with your Section 32 Vendor Statement. Don’t forget to also include the certificate for your Owner Builder Warranty Insurance if it was required. This completes your legal disclosure obligations and keeps your sale on the right track.

Protecting Your Hard Work

For a Melbourne owner-builder, a Section 137B Owner Builders Report is more than just a legal formality – it’s a formal recognition of your hard work and a commitment to a fair and transparent sale. It shows you stand by the quality of your property and gives your buyer the confidence they need to make an offer.

By understanding when the report is needed and getting it sorted early, you can avoid unnecessary stress and sidestep the legal dramas that can derail a property sale.

Ultimately, handling this step correctly means:

• You are complying with Victorian law.
• You are building trust with your buyer.
• You are paving the way for a smoother, less risky settlement for everyone.

Get it right, and your property sale is far more likely to be a straightforward and successful end to your owner-builder project.