New legislation consolidates fragmented framework and introduces prefabricated housing rules
New South Wales has passed legislation that fundamentally restructures the state's building approvals system, replacing decades-old certification processes with a single consolidated framework designed to accelerate housing delivery and reduce administrative costs for industry.
The legislation also repeals the Design and Building Practitioners Act 2020 and the Building and Development Certifiers Act 2018, along with their associated regulations, consolidating the existing fragmented legislative framework into a single piece of legislation.
The consolidation is designed to remove the need for duplicative designs for the same building elements, saving an estimated $330,000 per apartment block. It will also establish a system of staged approvals to allow construction to begin and for people to move in as early as possible, and permit minor variations to a building's development consent — such as changing the size of a door or installing an external tap — to be approved if they fit within the approval framework.
The Building (Approvals and Practitioners) Bill 2026 was introduced to the Legislative Assembly and passed the lower house in May. The bill was introduced by Minister for Building Anoulack Chanthivong and followed a period of industry consultation in which the NSW Government incorporated feedback to address practical challenges arising from earlier drafts.
The bill makes NSW the first Australian jurisdiction to recognise modern methods of construction (MMC) in law by formally defining "prefabricated buildings", integrating MMC into the approvals system, and introducing consumer protections for buyers of prefabricated homes.
The Commonwealth Productivity Commission has estimated that MMC, such as modular and prefabricated homes, can reduce overall costs by up to 20% and are up to 50% faster to build compared with traditional homes.
Under the new framework, building work involving a prefabricated building cannot commence unless a prefabricated building declaration and prefabricated building instructions have been obtained from the manufacturer and submitted to the relevant approval authority via the NSW planning portal.
The NSW government has committed funding to modern methods of construction as part of its latest budget.
The Property Council's NSW executive director Katie Stevenson (pictured right) said the reforms would modernise a fragmented approvals framework and create clearer pathways from design to completion.
"By consolidating building approvals, practitioner registration and enforcement requirements, these reforms will reduce duplication, improve certainty and help turn planning approvals into safe, high-quality homes more quickly," she stated. "This is practical reform that supports housing delivery while maintaining strong standards for building quality, safety and consumer protection."
Stevenson called on the government to ensure the supporting regulations were practical and well-designed. "Success will ultimately depend on practical regulations, well-designed transitional arrangements, digital systems and guidance that avoid unnecessary complexity," she said.
"We commend the government's consultative approach and will continue working constructively with the NSW Government and industry to turn this legislation and the Budget investment into stronger local capability and more homes delivered at the scale and pace NSW needs."
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