Property developer laws in the ACT: what you need to know

The Property Developers Act 2024 (the Act), introduces a range of obligations for property developers including licensing, defect rectification, a developer rating system and director liabilities. The Act has a staggered commencement, with some provisions now in place, and others to commence in the future.

Who is considered a “developer”?

You may be treated as a developer if your business is involved in certain residential development activities for residential building work.

The Act defines “residential building work” as building or altering a regulated residential building.  A “regulated residential building” is a Class 1 or Class 2 building or a building that contains a Class 2 building, constructed as part of a project to construct three or more dwellings.   You may be a developer if you do any of the following:

• contract or arrange for the building work to be done, or facilitate (e.g. commission) or cause the building work to be done
• own the land where the work is taking place
• are engaged as the principal builder (named as the builder in the building commencement notice)
• are the developer in relation to the units plan (e.g. owner of apartments or townhouses).

It is not only large development companies that are captured. Builders, landowners, investors, and owners’ corporations arranging for building work to be undertaken may also fall within the definition.

For builders, this means you could be considered both the builder and the developer on the same project. In practice, that means you may need to meet your usual obligations as a licensed builder under ACT building laws, while also taking on new responsibilities under the Act.

Who is not a developer?

The following are not considered a developer under the Act:

• Small-scale builder – where you are working on no more than two Class 1 dwellings in a project (a detached house or a duplex).
• Owner-builder for your own home – where you are building or renovating the home you live in, or plan to live in, as your main residence.
• Subcontractor – where you are engaged by a builder to perform specific trade work, but you are not managing the overall project.
• Consultant or professional adviser – such as a designer, engineer, or certifier, provided you are not responsible for financing, managing, or profiting from the overall building work.

What requirements are already in place?

Fixing defects and rectification orders

The Construction Occupations Registrar (the Registrar) has the power to order developers to fix serious defects found in residential building work. These orders can be made for building work that was approved on or after 11 July 2024 and can be issued for up to 10 years from the approval. 

A summary of the process is as follows:

1. If the Registrar finds a serious defect or a possible serious defect in regulated residential building during or after construction, a proposed rectification order notice will be given to the property developer.
2. The property developer will have an opportunity to respond, making submissions to the Registrar within 28 days of the notice.
3. After considering any submission, the Registrar may issue a rectification order if satisfied it’s appropriate to do so and may state the action required to rectify the issue, or the production of information about the required rectification work, or anything else necessary to ensure rectification work is done.
4. The developer will be required to rectify defects identified in the order within at least one month of the order being given, unless it is an emergency, in which case an order may be given without a notice beforehand. 

A rectification order may be given to two or more property developers in relation to the residential building work to which the order relates.

Stop work orders

If residential building work is being done, or likely to be done in a way that could result in significant harm or loss to the public or occupiers (or potential occupiers), or work is being done and there is no licensed property developer, the Registrar can issue a stop work order.  These orders can be made with or without prior notice and remain in force until revoked or for a maximum of 12 months.

Carrying out work while a stop work order is in place is a serious offence and may result in significant penalties.

Director responsibility

Directors and other individuals who control a developer company can be held personally liable for the costs of rectifying defects. This means that if the developer business becomes insolvent or is wound up, the Registrar still has powers to pursue the people behind the company to ensure rectification is carried out.

These provisions are designed to prevent phoenix activity and to ensure accountability, even where the developer entity no longer exists.

What changes are coming next?

Developer licensing

If you are the person or entity (e.g. company) that does any of the following related to residential building work and construction projects with three or more residential dwellings, a property developer licence will be required when:

• applying for development approval
• applying for a building approval, building commencement notice, or a certificate of occupancy
• selling or advertising the sale of residential property off-the-plan.

A licensed builder must apply for a commencement notice. This means that a property developer licence will also need to be held if you are the principal builder on a regulated residential building project.

Licensing will be implemented in two stages:

• From 1 October 2025, applications for a developer licence will open.
• From 1 October 2026, it will be mandatory to hold a licence if you or your entity requires it.  

To obtain a licence either as an individual or as a corporation, you will need to meet eligibility criteria set out in the Act and supporting regulations. While the detailed requirements are still to be finalised, it is expected that you will need to demonstrate:

• Financial stability – showing the business is solvent and has the capacity to meet obligations.
• Good character and history – having a clean record with no relevant convictions or significant past compliance breaches.
• Fit and proper person test – the registrar will consider factors such as honesty, integrity, and past conduct in the industry.
• Independent rating – applicants will be required to obtain and submit an iCIRT developer rating report from Equifax. 

Specific information about the licensing regime including licensing requirements, fees, a public register and the rating report is currently being developed by the Registrar, available on the property developer licensing page. 

Two-year defect presumption

From 1 October 2026, if the owner of a home, whether the original purchaser or a subsequent owner, makes a complaint about a defect within two years of the building work being completed (as recognised by the completion certificate under the building approval), the law assumes the work is defective unless the developer can prove otherwise.

This presumption applies only to developers (or licensed developers) under the Act. It does not extend to builders (unless also a “developer” under the Act), subcontractors, or other licence holders regulated under different legislation. To rebut the presumption, a developer may rely on evidence such as expert reports showing the problem is not a defect, or that it arose from later alterations, wear and tear, or external events outside the original construction.

Next steps

Based on the new powers and obligations introduced under the Act, developers should take the following steps to prepare:

1. Confirm whether you are considered a developer – the Act has a wide definition, and you may fall within it even if you are not physically carrying out the building work.
2. Keep detailed records of site activity, inspections, and communications – rectification orders and defect complaints can be made for up to 10 years, so maintaining records will be critical if you need to defend yourself.
3. Address defects early – the Registrar now has powers to issue rectification orders and stop work orders. Fixing issues before they escalate reduces the risk of formal enforcement action.
4. Review your contracts – developers carry new statutory responsibilities, so contracts should clearly allocate duties between you, the builder, and consultants.
5. Check your insurance coverage – with new liabilities and penalties in place, ensure your policies cover potential defect or compliance risks.
6. Prepare for licensing – applications open on 1 October 2025, and from 1 October 2026 a licence will be mandatory to provide developer services. Begin gathering the financial and compliance information you will need to support your application.
7. Review your company structure – as noted above, the Act allows the Registrar to pursue directors and other controlling individuals personally if the developer company cannot meet rectification costs. Reviewing governance and risk management arrangements now will help reduce that exposure.

By taking these steps early, developers can manage their risk, protect their projects, and ensure they are ready when the new licensing and compliance regime takes effect.

To find out more, contact HIA's Contracts and Compliance team

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