A kitchen renovation that blows out by $40,000. A new build where the builder vanishes mid-frame. A granny flat with structural cracks six months after handover. These are not rare horror stories. The Queensland Building and Construction Commission alone received over 4,200 complaints about builders in the 2023-24 financial year.
Hiring the right licensed builder is the single biggest factor in whether your building project succeeds or fails. Australia has over 94,000 licensed builders listed on TradieVerify, across every state and territory. This guide walks you through how to hire a licensed builder in Australia, from verifying their licence to understanding progress payments and your warranty rights.
Why You Should Only Hire a Licensed Builder
In every Australian state and territory, building work above a certain value threshold requires a licensed builder. These thresholds vary by state, but the principle is the same everywhere: building work is regulated because the consequences of poor work are serious.
Legal protection. A licensed builder has completed formal qualifications (typically a Diploma of Building and Construction, CPC50220) and demonstrated practical experience. Their work must comply with the National Construction Code.
Home warranty insurance. Licensed builders are required to provide home warranty insurance on projects above state thresholds. This insurance protects you if the builder dies, disappears, becomes insolvent, or has their licence suspended before completing the work or fixing defects.
Accountability. Licensed builders are registered with a state regulator. If there is a dispute, you have a formal complaints pathway and access to dispute resolution. With an unlicensed operator, your only option is civil court.
Statutory warranties. Under state building legislation, you receive automatic warranty protection: six years for major structural defects and two years for non-structural defects from the date of practical completion.
You can verify any builder’s licence instantly on TradieVerify’s search page.
1. Know When You Need a Licensed Builder
Not every home improvement job requires a licensed builder. Each state sets a minimum project value threshold above which a licensed builder must be engaged:
| State/Territory | Threshold for Licensing |
|---|---|
| QLD | $3,300 |
| NT | $8,000 |
| NSW | $5,000 |
| VIC | $16,000 (for domestic building insurance) |
| SA | $12,000 |
| ACT | $12,000 |
| WA | $20,000 (for home warranty insurance) |
| TAS | No set threshold |
Below these thresholds, you may still choose to hire a licensed builder for quality assurance and warranty protection. Above them, it is a legal requirement.
Owner-builder permits are available in most states, but they come with significant responsibilities including insurance, safety coordination, and warranty liability if you sell within six years.
2. Understand Builder Licence Classes
Builder licence classes are not uniform across Australia. Each state has its own system, and knowing the differences helps you confirm a builder is qualified for your specific project.
ACT (Classes A, B, C, D):
| Class | Scope |
|---|---|
| Class A | Unlimited height, any building classification |
| Class B | Up to 3 storeys, any use |
| Class C | Up to 2 storeys, residential buildings (Class 1, 2, 10a) |
| Class D | Ancillary structures only (sheds, carports, fences) |
Queensland (QBCC):
| Licence | Scope |
|---|---|
| Builder (Open) | All construction, unlimited scope |
| Builder (Medium Rise) | Residential and limited commercial, up to 3 storeys |
| Builder (Low Rise) | Residential only, up to 3 storeys |
| Builder (Restricted) | Specific categories: kitchen/bathroom, shopfitting, structural landscaping |
Victoria (VBA):
| Registration | Scope |
|---|---|
| Domestic Builder (Unlimited) | All domestic building work on homes |
| Domestic Builder (Limited) | Specific trades only: carpentry, bathroom renovation, external fixtures |
| Commercial Builder | Non-residential and commercial construction |
New South Wales:
NSW uses a contractor licence system rather than letter classes. A Contractor Licence for General Building Work covers the full scope of residential and commercial building. A Qualified Supervisor Certificate allows individuals to supervise on behalf of a licensed contractor.
When hiring a licensed builder, ask for their licence class and confirm it covers the scope of your project. A Class D builder in the ACT cannot build your house, and a Low Rise builder in Queensland cannot take on a four-storey apartment block.
3. Verify Their Licence Before You Sign Anything
This is the most important step. Before signing a contract or paying a deposit, verify the builder’s licence. Every state has a public register, and you can search across states on TradieVerify.
Here is what to check:
- Licence status. Is it current and active, or expired, suspended, or cancelled?
- Licence class. Does it cover the type and scale of your project?
- Business details. Does the licence match the business name and ABN the builder has provided?
- Disciplinary history. Some state registers show past enforcement actions, suspensions, or conditions on the licence.
Ask for the licence number upfront. Any legitimate licensed builder will provide it without hesitation. If someone refuses or makes excuses, walk away.
Browse licensed builders in Queensland, licensed builders in Victoria, licensed builders in Western Australia, or licensed builders in the ACT to see verified builder listings.
4. Understand Home Warranty Insurance
Home warranty insurance (also called domestic building insurance) is a last-resort policy that protects you if your licensed builder cannot complete the work or fix defects due to insolvency, death, disappearance, or licence suspension.
Key points:
- The builder must provide a certificate of insurance to you before work begins or any payment is accepted, including the deposit.
- Coverage lasts six years for major structural defects and two years for non-structural defects from the date of practical completion.
- This is not optional. A licensed builder who fails to provide required warranty insurance is breaking the law.
State thresholds and schemes:
| State | Threshold | Scheme |
|---|---|---|
| NSW | $20,000 | icare Home Building Compensation Fund (sole insurer) |
| VIC | $16,000 | Domestic Building Insurance via approved insurers |
| QLD | $3,300 | QBCC manages the scheme directly |
| WA | $20,000 | Approved private insurers |
| SA | $12,000 | Approved private insurers |
| ACT | $12,000 | Approved private insurers |
| NT | $12,000 | Approved private insurers |
| TAS | Not required | No mandatory scheme |
Before signing a building contract, ask for a copy of the warranty insurance certificate. Confirm the policy number, coverage amount, and that your name and address appear correctly.
5. Get at Least Three Detailed Quotes
For any building project, get a minimum of three written quotes from licensed builders. Pricing can vary by 30% or more between builders for the same scope.
What a proper building quote should include:
- Detailed scope of work with specifications (not just “build extension”)
- Itemised costs for labour, materials, subcontractors, and margins
- Whether GST is included (mandatory for businesses with turnover above $75,000)
- An estimated timeline with key milestones
- Payment schedule aligned to progress stages
- Allowances and provisional sums (with clear definitions)
- What is excluded (site costs, council fees, landscaping, utility connections)
Allowances vs provisional sums. An allowance is a fixed budget for items you have not yet selected (like floor tiles). A provisional sum is the licensed builder’s best estimate for work that cannot be priced until construction begins (like excavation). Get both clearly defined in writing.
Fixed-price vs cost-plus. Most residential builds use fixed-price contracts for cost certainty. Cost-plus contracts are sometimes used for renovations where the scope is hard to define. If you go cost-plus, insist on a maximum price cap.
6. Read the Building Contract Carefully
Written contracts are mandatory for building work above certain values ($5,000 in NSW, $10,000 in VIC). A licensed builder must include their licence number, insurance details, full scope of work, total price, payment schedule, start and completion dates, dispute resolution process, and cooling-off period (typically 5 business days).
Watch out for:
- Variation clauses. A fair clause requires written approval from both parties before any variation work begins, with the cost agreed in advance.
- Time extensions. Check what events entitle the builder to extend the timeline and how much notice they must give.
- Defects liability period. Typically 13 weeks under HIA contracts, during which the licensed builder must return to fix defects you identify.
For contracts over $50,000, consider having a building lawyer review before you sign. The cost ($500-$1,500) is small compared to the risk.
7. Understand Progress Payment Schedules
When you hire a licensed builder, the project is paid in stages tied to construction milestones. This protects both parties: the builder gets cash flow, and you only pay for completed work.
Standard progress payment stages:
| Stage | Typical % of Contract |
|---|---|
| Deposit | 5% (max 10% for contracts under $20,000 in VIC) |
| Base/slab | 10-15% |
| Frame | 15-20% |
| Lock-up (roof, external walls, windows, doors) | 25-35% |
| Fixing (internal fit-out, plasterboard, cabinetry, fixtures) | 20-25% |
| Practical completion | 10% |
In Victoria, the Domestic Building Contracts Act 1995 legally prescribes these percentages. In other states, the stages follow HIA or Master Builders contract templates but are not legislated.
Rules for progress payments:
- Never pay ahead of the work completed. If the frame is not up, do not release the frame stage payment.
- Inspect each stage before authorising payment. Consider hiring an independent building inspector for $300-$600 per stage inspection.
- Keep 5-10% as a retention until all defects identified at practical completion are rectified.
- In Victoria, the maximum deposit a builder can charge is 5% for contracts over $20,000.
8. Know What Building Work Costs in Australia
Building costs vary significantly by state, project type, and specification level. Here are indicative costs as of 2025-2026:
New home construction (per square metre):
| Build Type | Cost per m² | Indicative Total (200m² home) |
|---|---|---|
| Volume/project home | $1,600 - $2,500 | $320,000 - $500,000 |
| Custom/architect-designed | $2,700 - $3,900 | $540,000 - $780,000 |
| Luxury/premium | $3,900 - $5,500+ | $780,000 - $1,100,000+ |
Renovation and extension costs:
| Project Type | Cost Range (AUD) |
|---|---|
| Home extension (single storey, per m²) | $1,500 - $4,000 |
| Home extension (second storey, per m²) | $2,500 - $5,000 |
| Typical 40m² extension | $60,000 - $160,000 |
| Bathroom renovation (standard) | $15,000 - $35,000 |
| Bathroom renovation (luxury) | $35,000 - $50,000+ |
| Kitchen renovation (mid-range) | $22,000 - $45,000 |
| Kitchen renovation (high-end) | $45,000 - $100,000+ |
| Granny flat (60m²) | $90,000 - $180,000 |
These figures typically exclude site costs, council and DA fees, landscaping, driveways, and utility connections. Always allow a 10-15% contingency for unexpected costs.
Location matters. Sydney builds tend to cost 15-25% more than Brisbane or Adelaide. Regional areas can be cheaper for labour but more expensive for materials due to delivery costs.
9. State-by-State Builder Licence Guide
Each Australian state and territory has its own licensing authority for builders. Here is a summary with real licence counts from the TradieVerify database:
| State | Regulator | Active Licensed Builders on TradieVerify | Verify Licences |
|---|---|---|---|
| VIC | Victorian Building Authority (VBA) | 41,570 | Browse VIC builders |
| QLD | Queensland Building and Construction Commission (QBCC) | 35,393 | Browse QLD builders |
| WA | Building and Energy (Building Services Board) | 12,413 | Browse WA builders |
| ACT | Access Canberra | 4,751 | Browse ACT builders |
| NSW | Building Commission NSW | Coming soon | Browse NSW builders |
| SA | Consumer and Business Services (CBS) | Coming soon | Browse SA builders |
| TAS | Consumer, Building and Occupational Services (CBOS) | Coming soon | Browse TAS builders |
| NT | Building Practitioners Board (BPB) | Coming soon | Browse NT builders |
Key differences between states:
- Victoria has the most detailed registration system, with over 30 defined classes of domestic building work. The VBA is transitioning to the Building and Plumbing Commission.
- Queensland uses the QBCC for both licensing and home warranty insurance management. The $3,300 licensing threshold is the lowest in Australia.
- Western Australia uses a registration pathway system based on combinations of qualifications and experience, with five defined “sets” of entry requirements.
- ACT is the only jurisdiction that uses the A/B/C/D class system, which directly maps to building height and classification.
10. Red Flags When Hiring a Licensed Builder
Protect yourself by knowing the warning signs:
- No licence number on quotes or contracts. Licensed builders display their licence number on all documentation and often on their vehicle and signage.
- Demands for large upfront deposits. In Victoria, the maximum deposit is 5% for contracts over $20,000. A builder asking for 20-30% upfront is either breaking the law or not using a proper contract.
- No home warranty insurance certificate. The builder must provide this before accepting any payment. No certificate means no protection.
- Cash-only, no invoice. This likely means the builder is not registered for GST, and you will have no paper trail if something goes wrong.
- Pressure to skip council approval. Any builder who suggests you do not need a building permit or DA is setting you up for enforcement action, demolition orders, and fines.
- Unwillingness to provide a written contract. Verbal building agreements are a recipe for disputes.
- No fixed address or business premises. While many builders work from home, a builder with no traceable address is a risk.
- Extremely low quotes. If one quote is 30% below the others, question why. The builder may be planning to recover the difference through variations, or they may not finish the job.
If you suspect someone is operating without a licence, report them to your state’s licensing authority. In Queensland, you can report unlicensed building work directly to the QBCC.
Frequently Asked Questions
How do I check if a builder is licensed in Australia?
You can search for any builder’s licence on TradieVerify’s search page, which aggregates licence data from state regulators across Australia. Each state also has its own verification tool: QBCC Licence Search for Queensland, Service NSW Licence Check for New South Wales, VBA Practitioner Search for Victoria, and Access Canberra for the ACT. Ask the builder for their licence number and verify it before signing any contract.
How much does it cost to hire a licensed builder in Australia?
Costs vary widely depending on the project. A standard new home build ranges from $1,600 to $2,500 per square metre for a project home, or $2,700 to $3,900 per square metre for a custom build. Renovations typically cost $3,000 to $7,000 per square metre depending on the scope and finish level. A bathroom renovation averages $15,000 to $35,000, while a kitchen renovation runs $22,000 to $45,000 at mid-range.
What is home warranty insurance, and do I need it?
Home warranty insurance is a mandatory insurance policy that protects homeowners if a licensed builder cannot complete work or fix defects due to insolvency, death, or licence cancellation. The builder must provide it before accepting any payment. It covers major structural defects for six years and non-structural defects for two years. Thresholds vary by state: $3,300 in QLD, $5,000 in NSW (contractor licensing), $16,000 in VIC, and $20,000 in NSW (for insurance) and WA.
What are progress payments, and how do they work?
Progress payments are staged payments tied to construction milestones rather than calendar dates. The standard stages are deposit (5%), base/slab (10-15%), frame (15-20%), lock-up (25-35%), fixing (20-25%), and practical completion (10%). You should only release each payment after inspecting and confirming that the corresponding stage of work has been completed. In Victoria, these percentages are legally prescribed.
What should I do if my builder goes bust mid-project?
If your builder becomes insolvent during construction, your home warranty insurance is your primary protection. Contact the insurer listed on your warranty insurance certificate to lodge a claim. The insurance covers the cost of completing the work or rectifying defects, up to the policy limit. If the project value was below the warranty insurance threshold for your state, you may need to pursue a civil claim. Either way, contact your state’s building regulator for guidance on next steps.
Can I act as my own builder (owner-builder)?
Yes, most states offer owner-builder permits, but they come with significant obligations. You must coordinate all subcontractors, ensure compliance with the NCC, manage workplace health and safety, and obtain all required inspections. In NSW, you need to complete an approved course for projects over $10,000. If you sell the property within six years, you assume the same warranty obligations as a licensed builder, which means you may need to take out owner-builder warranty insurance.
Summary
Hiring a licensed builder in Australia comes down to these steps:
- Verify the licence on TradieVerify or the relevant state register before signing any contract
- Check the licence class to confirm the builder is qualified for your specific project type and scale
- Get home warranty insurance documentation before paying any deposit, and confirm the certificate details
- Get three detailed quotes with itemised costs, allowances, and provisional sums clearly defined
- Read the contract and understand variation clauses, payment schedules, and dispute resolution procedures
- Pay in stages tied to completed milestones, and consider independent inspections at each stage
- Know your rights to six years of structural defect warranty and two years for non-structural defects
With over 94,000 licensed builders listed across Victoria, Queensland, Western Australia, and the ACT, finding a qualified tradesperson starts with a simple licence check. Search for a licensed builder in your area on TradieVerify and take the first step towards a successful building project.
Related Guides
- Australian Builder Licensing Explained — Our builder licensing guide
- How Much Does a New Build Cost Per Square Metre? Full 2025–2026 Price Guide — Our new build costs
- Checklist: Before Your Builder Starts Work — Our builder start checklist
Sources
- Queensland Building and Construction Commission: Builder Licensing, https://www.qbcc.qld.gov.au/
- Victorian Building Authority: Building Practitioner Registration, https://www.vba.vic.gov.au/
- Building Commission NSW: Choosing a Builder, https://www.nsw.gov.au/departments-and-agencies/building-commission
- SIRA NSW: Home Building Compensation Fund, https://www.sira.nsw.gov.au/home-building-compensation
- Consumer Affairs Victoria: Deposits and Progress Payments, https://www.consumer.vic.gov.au/housing/building-and-renovating/plan-and-manage-your-building-project/deposits-and-payments
- Housing Industry Association (HIA): Residential Building Contracts, https://hia.com.au/
- Master Builders Australia: Find a Builder, https://masterbuilders.com.au/
- ACT Planning: Construction Licences, https://www.planning.act.gov.au/professionals/regulation-and-responsibilities/construction-licences