What is practical completion, and what should I check before the final payment?

Practical completion is the point when the building work is finished in line with the contract and plans, apart from minor defects or omissions that don't stop the home being used for its intended purpose. How it is defined, and what happens next, depends on your contract and your state or territory's laws.

Common steps at this stage include:

• Reading your contract's practical completion and final payment clauses before the builder issues a final claim.
• Doing a pre-handover inspection, either yourself or with an independent inspector, and agreeing a written list of defects or incomplete items with your builder.
• Confirming you have received the documents your contract and state require, such as the occupancy or final certificate and compliance certificates.
• Checking the final claim against the contract amount and any approved variations.

If you disagree about whether the work is complete, or about the final claim, talk to your builder in writing first. If that doesn't resolve it, contact your state or territory building regulator or fair trading body. Before withholding any payment, get independent legal advice, because withholding payment can have contractual consequences.

Related FAQs: Should I get an independent defects inspection before accepting handover? · What documents are required at completion · What compliance documentation is required for an Occupation Certificate (OC)? · How do I resolve contractual disputes with builders or subcontractors?

This is general information only and is not legal or financial advice. Find your state or territory building regulator here: State and territory building administrations.