Handover and PCI process (residential)
Handover and PCI: pre-completion inspection, defects list, occupation certificate, handover meeting, key transfer, retention release. Step-by-step procedure.
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The handover process leads from “build done” to “client has the keys and the wall warranty starts”. It involves: a Pre-Completion Inspection (PCI) walk-through with the client to identify defects; a defects list documented and signed by both parties; the Occupation Certificate (OC) issued by the certifier; a handover meeting where the builder briefs the client on maintenance, warranties, and contact points; key transfer to the client; and first-tranche retention release if the contract allows. Practical Completion (PC), handover, and the OC are three related but distinct milestones; contracts often blur them. This process pins them down.
The three milestones (often confused)
| Milestone | What it means | Trigger |
|---|---|---|
| Practical Completion (PC) | Build complete enough to occupy; defects acceptable | Contractually defined; usually requires OC pending or issued |
| Occupation Certificate (OC) | Certifier confirms build complies with NCC + approval conditions | After CSI sign-offs, fire safety, OC inspection |
| Handover | Client takes possession; keys transferred | After PC + OC, contract-defined |
A build can be at PC without the OC issued yet (defects acceptable but OC inspection pending). The client cannot take possession (handover) until OC issued.
Step 1: Pre-Completion Inspection (PCI)
Typically 2-4 weeks before scheduled handover. The PCI is a walk-through with the client to identify any defects, incomplete work, or items needing rectification.
Process:
- Schedule the PCI 5-10 working days ahead: client needs to plan their visit.
- Site is build-clean: all trades have demobilised, site cleaner has been through.
- Builder walks the client through every room systematically.
- Client raises defects, incomplete items, finishes concerns.
- Builder documents each item on a defects schedule with location, description, severity.
- Both parties sign the defects schedule.
- Builder commits to a defect rectification date typically 5-10 working days.
Common defects identified at PCI:
- Touch-ups: paint, plaster, joinery finishes.
- Joinery defects: doors out of square, drawers sticking.
- Tile defects: chipped tiles, grout missing.
- Plumbing: taps not aligned, drains slow.
- Electrical: lights flickering, GPOs not flush.
- Finishing carpentry: skirting joints, architrave joints.
Most PCIs identify 20-80 defects. Volume builders typically resolve all in 1-2 weeks; custom builds may take longer.
Step 2: Rectification
Builder works the defects list:
- Assign each defect to a trade: chippy for joinery, painter for touch-ups, sparky for electrical.
- Schedule rectification visits to minimise site disturbance after PCI.
- Photo-document each rectification (before/after).
- Re-inspect each item before declaring it resolved.
- Update the defects list as items close.
Step 3: Occupation Certificate (OC)
Once defects are resolved (or the certifier accepts them as minor and not blocking OC), the OC process runs:
- OC inspection request to certifier: builder formally requests.
- Certifier visits: checks for compliance with approved drawings, NCC, conditions.
- Certifier issues OC (or notes outstanding items).
- OC is a formal certificate issued under EP&A Act (NSW) or Building Act (Vic) equivalents.
Interim OC (NSW): allows partial occupancy if some work outstanding. Final OC: full occupancy authorised.
Typical timing: 5-10 business days from request.
Step 4: Handover meeting
Once OC is issued, the handover meeting happens. Typical agenda:
| Topic | Detail |
|---|---|
| Walk-through (final) | One more walk-through with the client to confirm everything is in working order |
| As-built drawings | Hand-over folder with architectural, structural, services drawings |
| Manufacturer warranties | Appliance, fixtures, fittings warranties |
| Statutory warranties | HBI / DBI / state scheme insurance disclosure |
| Termite durable notice | Show location, explain inspection schedule |
| Maintenance manual | Care instructions for finishes, joinery, plumbing |
| Emergency contacts | Builder, plumber, sparky for urgent issues |
| Defects liability period explanation | Typically 6-12 months; what’s covered, how to lodge |
| Key set | All keys to the property |
| Final payment | PC payment due |
The meeting is typically 60-90 minutes on a custom build, less on volume.
Step 5: Key transfer
- All keys to the client: front door, back door, garage, security panel, mailbox.
- Spare keys if standard.
- Digital access: garage codes, alarm codes, smart lock setups documented.
The client now has possession.
Step 6: First-tranche retention release
If the contract allows retention release at handover (some do, some hold until defects period end):
- Calculate retention amount: 5% of contract typical, sometimes 2%.
- Issue retention release invoice if applicable.
- Document the release in the contract record.
Most contracts hold ALL retention until the defects period ends (6-12 months post-handover) and the builder has completed any defects that emerge.
Step 7: Defects liability period commences
From the handover date, the defects liability period runs:
- 6 months for cosmetic defects (typical).
- 12 months for major defects (typical).
- 2-6 years for structural defects (statutory, varies by state).
Client raises defects via:
- Email / written notice to the builder.
- Builder schedules rectification typically within 5-10 working days of notice.
- Builder documents each defect rectification.
End of defects period: final retention released (if held).
Common builder issues
- PCI rushed or skipped: defects list incomplete; client raises issues post-handover. Trust erodes.
- OC delayed by outstanding CSI items: handover slips weeks while CSI is back-checked.
- Termite durable notice forgotten: certifier may withhold OC.
- Keys not all collected: client moves in and discovers missing keys.
- As-built drawings missing: client buys the property in 5 years; new buyer asks for plans; builder still on the hook to produce.
- No formal handover meeting: client unaware of warranties, maintenance, emergency contacts.
For builders
- Schedule PCI 2-4 weeks before contractual handover date: gives time for rectification.
- Use a defects-list template: rows for location, item, action, date, status.
- Photograph the build at handover: as-built record protects against later disputes.
- Hand over a complete pack: as-builts, warranties, maintenance manual, emergency contacts, defects-process explanation, termite durable notice copy.
- Get the handover meeting agenda signed: client confirms they received the pack and were briefed.
References
- NSW Fair Trading handover guidance: https://www.fairtrading.nsw.gov.au (verified 2026-05-16).
- Consumer Affairs Victoria handover: https://www.consumer.vic.gov.au (verified 2026-05-16).
Related
See also
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Last updated: 2026-05-16. Verified: 2026-05-16.