Victoria's builders warranty just changed. The new scheme can fix your house, not just write you a cheque.

For years Victorian homeowners had domestic building insurance, and it only responded if the builder died, disappeared or became insolvent. A builder still trading, still answering the phone, and simply refusing to come back and fix the work was not a claimable event. You could sue. You could not claim.

Home Warranty replaced that on 1 July 2026, for eligible contracts signed on or after that date. It comes from the Building Legislation Amendment (Buyer Protections) Act 2025, which received Royal Assent on 3 June 2025.

Read (a) and (b) again. The old scheme wrote cheques. This one can send builders.

For an owner living in a half-finished house that is a different thing entirely. Money is only useful if you can find someone willing to take it and finish the job, and anyone who has tried to get a second builder to inherit another builder's work knows how that conversation goes.

Worth noting what the Act does not say. Across 161 pages it never once uses the words "Home Warranty". It calls it the statutory insurance scheme, sitting in a new Part 9A of the Building Act 1993. Home Warranty is the name the regulator uses publicly.

Owner-builders get nothing. If you take out an owner-builder permit, this scheme does not assist you. That is a coherent policy choice, since you are your own builder and the scheme insures against builders. It will still surprise people who assumed a state scheme covered every home.

Three homes is the line. The exclusion is aimed at commercial-scale work, and if you are building one house nothing here touches you. But a family trust putting up three townhouses, or a small developer doing a few units, sits on the wrong side of a threshold most will never have read.

This is why checking the register before you pay anybody is not paperwork. It is the difference between having $400,000 of cover behind you and having none. It takes about thirty seconds on the Commission's own practitioner search, and people who skipped it have lost houses.

The $400,000 is an overall cap, not a per-item figure. It has to stretch across rectification, accommodation, removal and storage, and the cost of securing an incomplete site. Incomplete work is separately capped at 30% of the contract price including agreed variations. A lost deposit, where work never started, may be covered.

Minor cosmetic differences between the finished work and your plans are not covered, and the Commission has published a determination setting out examples.

Both clocks run from the completion date for the work. Which one applies depends entirely on whether your problem counts as a major defect, and that is where most explanations stop.

Waterproofing is a major defect. That is the sentence worth remembering.

Leaking showers. Failed balcony membranes. Water finding its way into the building envelope. These are among the most common serious defects in Australian housing, they are frequently the most expensive to put right, and they very often take more than two years to reveal themselves. Under this scheme they sit in the six year window by name.

The reason waterproofing belongs in the longer window is that it rarely announces itself. Water moves behind linings and under floors for a long time before it appears somewhere a person can see it, which is precisely why a two year limit caught so many owners out.

It is also worth understanding what that fixes. In Victorian Building Authority v Fall-Armytage, decided by the Court of Appeal in March 2026, a purchaser lost a claim under the old scheme because his defects were non-structural and fell inside a two year clause. Under Home Warranty the category is defined in a regulation anyone can read, and waterproofing is expressly in the longer half.

That last one is the practical difference between insurance that waits for a company to collapse and insurance that responds when the work goes wrong.

Your builder must pay the premium to the Authority before the earlier of ten business days after signing, or work starting. Section 137P is explicit that the builder pays it on behalf of the building owner. The Authority must then issue a notice of cover and, under section 137T, must give you a copy as soon as practicable.

Then comes the part that gives it teeth. Under the amended section 24A, a building permit cannot issue for work under an insurable domestic building contract unless a notice of cover has been issued. And under section 137U it is an offence to tell someone a notice of cover exists when it does not, carrying penalties of 500 penalty units for an individual and 2,500 for a company.

An independent leak inspection finds waterproofing failures while they still sit inside the six year window, and an independent inspection for an insurance claim establishes what has actually been built. Insurance decides who pays when the work is wrong. You want both, and you want them in that order.