Updated October 2026
CM Law’s Ultimate List of the Top 50 FAQs on Buying a Residential Investment Property | Article 34
When buying a residential investment property in NSW, checking the building’s structural integrity is essential. Foundation movement, roof damage, deteriorating balconies and termite damage can create safety risks, major repair bills and disputes. Water penetration and persistent mould also deserve investigation, even where they do not indicate structural failure. A careful inspection and review of the property records can help you understand these risks before committing to the purchase.
Why structural integrity matters to property investors
Structural integrity concerns a building’s ability to remain stable and safely carry the loads placed on it. For an investor, sound construction and proper maintenance protect occupants, support the property’s value and help avoid interruptions to rental income. A freshly painted apartment may still sit within a building that needs extensive common-property repairs.
The financial consequences can extend beyond the repair invoice. Consider investigation costs, special levies, lost rent and the expense of managing a dispute. Obtain property-specific advice and quotations rather than assuming every crack is serious or relying on a generic repair allowance. Some defects are minor; others require prompt assessment by an engineer.
1 Arrange suitable inspections before buying
The NSW Government recommends a pre-purchase building inspection by a suitably qualified professional. Arrange it before becoming unconditionally bound wherever possible. Check the inspector’s experience, insurance and scope of work, and commission a separate pest inspection where appropriate.
A standard building report generally covers visible, accessible areas. It is not a guarantee against hidden defects, a full engineering assessment or a certificate of legal compliance. Read the exclusions and recommendations carefully. Restricted roof access, concealed foundations or inaccessible cavities may require further investigation. Ask a structural engineer to assess suspected movement or instability, and obtain specialist advice about recurring leaks or failed waterproofing.
For an apartment, confirm whether the inspection covers relevant common property. A report confined to the unit may not assess the roof, basement or other areas responsible for damage inside it.
2 Review the strata records and repair funding
A physical inspection and a strata records search answer different questions. The NSW guide to buying strata property explains the importance of examining the scheme’s records and financial position. Review meeting minutes, defect reports, correspondence, insurance, the capital works fund and proposed special levies.
Look for repeated references to leaks, concrete deterioration or repairs that remain unresolved. Ask whether the cause has been identified, a repair scope approved and funding arranged. A low levy is not necessarily an advantage if substantial work has been deferred. Your share of common-property costs can materially change the investment’s affordability. Have your solicitor review the contract and records alongside the technical reports.
3 Understand the relevant NSW obligations
Responsibility depends on the property, the defect and the legal relationship involved. Under section 106 of the Strata Schemes Management Act 2015, the owners corporation must generally maintain and repair common property. The official repairs guidance explains how responsibility is allocated. Check the strata plan and applicable by-laws before assuming that everything inside an apartment belongs to the owner or everything leaking is common property.
Investors also have obligations to tenants. NSW minimum rental standards require homes to be structurally sound, adequately ventilated and fit for habitation. Responsibility for mould depends on its cause. A building fault or inadequate ventilation may make the landlord responsible; an occupant’s conduct may also be relevant. Investigate the source rather than automatically blaming the tenant.
Buyers should not assume that a seller must volunteer every building defect. Contract disclosure requirements, representations and an agent’s duties need separate consideration. NSW agent disclosure rules include prescribed material facts, such as significant health or safety risks. Independent inspections remain important even where the agent describes the property as being in good condition.
4 Act within the correct time limits
For relevant residential building work, statutory warranty periods generally run for six years for major defects and two years for other defects, from completion. A qualifying breach becoming apparent in the final six months may allow an additional six months. Buying the property later does not ordinarily restart those periods.
Separate rules govern claims against an owners corporation. The strata reforms commencing on 1 July 2025 extended the damages claim period under section 106 from two to six years. The trigger is first awareness of the loss, and older claims require specific advice. Do not assume an expired claim has revived. Reporting defects or negotiating repairs does not automatically protect a filing deadline.
Christine’s experience with a strata mould dispute
We are currently dealing with a dispute in a strata complex where a resident has reported serious health concerns, describing the problem as “mould in their bloodstream”. That is an alarming thing to hear, and it brings home how personal a building dispute can become. For the person living there, it is about their home and health as well as who pays for repairs.
I would not turn that description into a medical conclusion. The diagnosis and any connection with the building need proper medical evidence. From the legal side, my focus is on identifying the source of the problem, establishing who is responsible and addressing the repairs. Building reports and medical evidence have different roles; one cannot simply stand in for the other.
The matter is ongoing. The lesson for an investor is to take a report of persistent damp or mould seriously and investigate promptly. Cleaning a visible patch does not resolve an underlying leak. Waiting until everyone agrees about liability can allow the practical problem to continue.
The Australian Centre for Disease Control explains that mould exposure can trigger or worsen illness in some people, although most people experience no health problems. It recommends addressing the moisture source and seeking medical advice about symptoms. Mould in a home does not, by itself, establish a bloodstream infection or prove where an illness originated.
A real case on water damage and lost rent
In Vickery v The Owners – Strata Plan No 80412 (2020), water entered an apartment through common property and the owner claimed $97,000 in lost rent. The owners corporation accepted the breach, resulting loss and amount. The dispute on appeal concerned whether NCAT had power to award damages.
The NSW Court of Appeal held, by majority, that NCAT had that power under the strata legislation. It allowed the appeal and returned outstanding issues to the Appeal Panel. The case demonstrates how unresolved common-property defects can affect rental income. It does not mean every leak produces an entitlement to the same compensation.
What the verified defect statistics show
Building Commission NSW’s 2025 Strata Defects Research Report found that 53% of 520 surveyed buildings had experienced serious common-property defects. The research covered NSW class 2 strata buildings with at least four above-ground floors, registered between July 2018 and June 2024. Serious defects included waterproofing, fire safety and other categories, as well as structural integrity.
Among surveyed buildings with serious defects, 36% had those defects reported to the regulator. These findings support careful investigation but do not establish the defect rate for every NSW home. They also do not predict the condition of an individual apartment or the amount an owner will spend on repairs.
Practical lessons before you commit
First, arrange appropriate building and pest inspections. Second, follow up any recommendation for engineering or moisture investigations. Third, review strata records and funding for proposed works. Fourth, obtain written repair estimates and consider potential rental disruption. Fifth, ask your solicitor to check responsibility, available claims and deadlines before relying on a promise that someone else will fix the problem.
If you already own the property, keep dated photographs, reports, repair requests and records of expenditure or lost rent. Notify the relevant parties promptly and obtain advice about urgent action where necessary. Contact CM Lawyers for assistance with a proposed purchase, strata repair dispute or building defect claim.
Key resources
- Pre-purchase inspection reports and buying a strata property — NSW Government guidance on inspections, records and financial checks.
- Strata repairs and maintenance and guide to strata law changes — Common-property duties and the changes commencing on 1 July 2025.
- Minimum standards for rental properties and mould in a rental property — NSW landlord and tenant obligations.
- Misrepresentation and material facts — NSW property agent disclosure duties.
- Resolving building disputes — Building Commission NSW guidance on statutory warranties and disputes.
- Preventing mould exposure — Australian Centre for Disease Control health guidance.
- Vickery v The Owners – Strata Plan No 80412 (2020) — Official NSW Court of Appeal judgment on NCAT’s power to award damages.
- 2025 Strata Defects Research Report and full report — Building Commission NSW survey findings and methodology.
