New NSW Laws: Why Sellers Must Now Disclose Building Defects
24 Jun 2025
Fran Luccitti

New NSW Laws: Why Sellers Must Now Disclose Building Defects

NSW has introduced new laws that require property sellers to disclose any known building defects before a sale contract is signed. These changes are all about fairness — making sure buyers have the information they need to make smart decisions and avoid costly surprises after moving in.

Legal Changes & Why Full Disclosure Matters

The new disclosure requirements are designed to protect buyers from unexpected repair bills and reduce disputes after settlement. Sellers must now reveal any building defects they’re aware of — and failing to do so can lead to serious consequences.

Example of Non-Disclosure and Its Consequences


In one recent case in NSW, a seller failed to tell the buyer about significant termite damage that had already been reported in earlier building inspections. The termites had caused structural damage to the timber framing inside the walls and under the floors — repairs that didn’t come cheap.

The buyer went ahead with the purchase, only to discover the damage after settlement during their own inspection. This led to a legal dispute, with the buyer claiming the seller had misled them by not disclosing the issue. The result? A long, expensive legal battle, with the seller eventually having to pay compensation to cover the repair costs and legal fees.

This case shows just how important it is for sellers to be upfront about any known defects. It can save a lot of stress, time, and money for everyone involved.

If you want to read more about these legal requirements, visit the NSW Fair Trading website: Selling a property - Fair Trading NSW.

What This Means for Sellers

If you’re selling:

  • Be honest about what you know — it’s the law.

  • Consider a pre-sale inspection to uncover any issues early.

  • Save yourself trouble later — disclosure can help avoid disputes and legal battles.

What This Means for Buyers

If you’re buying:

  • Ask the right questions and review all disclosures carefully.

  • Get your own inspection — it’s worth it for peace of mind.

  • Know your rights — if something was hidden from you, you may be entitled to compensation.

The Bottom Line

These changes are here to make buying and selling property in NSW more transparent and fair. Whether you’re selling or buying, staying informed, being upfront, and seeking professional advice will go a long way in ensuring a smooth transaction.

 

Note: This is general information only. Please speak to a legal or property professional for advice about your specific situation.