Handling Unapproved Structures and Renovations in Property Settlements

Buying or selling property is exciting, but it also comes with plenty of fine print and processes that can be stressful if something unexpected pops up. One of the most common surprises is the discovery of an unapproved structure, maybe it’s that DIY patio the seller built years ago, a shed added without council permits, or even a converted garage that’s now being used as a bedroom. While these additions might make a home more liveable, they can quickly complicate a property settlement if the proper approvals aren’t in place.

At Strategic Settlements, we’ve seen firsthand how issues like these play out. Sometimes they’re a minor hiccup, other times they cause major delays or even put the entire deal at risk. The good news? With the right approach and guidance, these challenges can usually be resolved without derailing the settlement.

What Counts as an Unapproved Structure?

When people talk about “unapproved structures,” they’re usually referring to any building works or renovations carried out without the required local council approval. Councils in Western Australia have strict rules for what needs approval, and it’s not just big projects like extensions or second-storey additions. Even smaller jobs may require sign-off to ensure safety and compliance.

Common examples include:

  • Backyard sheds or granny flats that haven’t been approved
  • Patios, pergolas, or decks added without council permits
  • Swimming pools or spas installed without compliance certificates
  • Internal renovations, like knocking out walls or moving plumbing, that weren’t approved
  • Garage conversions into extra living spaces

While some homeowners may think “it’s only a small shed, what’s the harm?”, councils take non-compliance seriously. What seems like a harmless DIY project can actually pose safety risks, impact property insurance, and reduce the value of a home if not addressed properly.

Why Unapproved Structures Matter in Settlements

Unapproved structures matter because they can disrupt the smooth transfer of property ownership. Settlements are designed to be clear-cut: the buyer pays, the seller hands over the keys, and everything is legally tied up. But when an unapproved renovation is uncovered, that clarity disappears, and both sides may be left scrambling for solutions.

For Buyers

From a buyer’s perspective, finding out that a property contains unapproved works can be alarming. Concerns typically include:

  • Compliance and safety: Will the structure meet building codes, or could it pose risks?
  • Insurance coverage: Insurers may refuse to cover damage related to an unapproved building.
  • Unexpected costs: Fixing, modifying, or even demolishing an unapproved structure can cost thousands.
  • Delays in moving in: If rectification is required before settlement, buyers may not be able to move in as planned.

For first-home buyers especially, these issues can come as a nasty surprise, as they may not know to ask about approvals during inspections.

For Sellers

Sellers may see unapproved structures as “no big deal,” but failing to disclose them can cause these serious problems:

  • Legal obligations: In WA, sellers must disclose material facts, including unapproved works.
  • Settlement delays: If the issue is discovered late, the process can stall until it’s resolved.
  • Risk of losing the sale: A buyer may walk away entirely or renegotiate for a lower price.
  • Reputation damage: A seller who withholds information risks disputes, legal action, and loss of trust.

The Legal Impact

Legally, unapproved structures can’t simply be ignored. Councils may require retrospective approval, or in some cases, demolition. This often means more paperwork, fees, inspections, and time. In other scenarios, the buyer and seller may renegotiate the sale price to cover the cost of rectification.

Ultimately, these issues put additional stress on both parties and can turn what should be a straightforward settlement into a drawn-out process.

Steps Buyers and Sellers Can Take

The best way to avoid headaches is for both parties to be proactive.

For Buyers

  • Check council records early. Ask for a property’s approval history as part of your due diligence.
  • Book a thorough inspection. A qualified building inspector can help identify any unapproved additions.
  • Seek professional advice. While a settlement agent in Perth can explain your options, you may also need guidance from a lawyer if the matter is complex.
  • Plan for contingencies. If you still want the property, be prepared to negotiate on price or factor in the cost of gaining retrospective approval.

For Sellers

  • Be transparent. Disclose any unapproved structures up front—buyers will likely find out anyway.
  • Contact your council. Check if retrospective approval is possible and what the process involves.
  • Act early. Sorting out compliance before listing your property can save a lot of stress during negotiations.
  • Negotiate smartly. If rectification costs are high, offering a price reduction may be more practical than losing the sale.

How Settlement Agents Can Help

This is where having an experienced settlement agent becomes invaluable. While settlement agents don’t provide legal or financial advice, they do play a key role in guiding both buyers and sellers through the process.

A skilled settlement agent in Perth can:

  • Review documents to ensure that disclosures are correctly made
  • Liaise with councils to clarify the approval status of structures
  • Communicate with the buyer’s or seller’s representatives to resolve concerns
  • Manage the timing of settlement to reduce delays where possible
  • Provide clear, practical advice on how to keep the transaction moving forward

At Strategic Settlements, we understand that these situations can be stressful. Our role is to simplify the process, keep everyone informed, and make sure the settlement stays on track.

The Bottom Line

Unapproved structures are a common issue in property transactions, but they don’t have to be deal-breakers. With transparency, the right steps, and the support of professional settlement agents in Perth, both buyers and sellers can reach a successful outcome.

If you’re preparing to buy or sell a property, don’t leave things to chance. At Strategic Settlements, we use our 115+ years of combined experience to resolve concerns quickly, negotiate fair outcomes, and keep your settlement on track. Backed by our on-time guarantee, you can trust us to keep things moving smoothly.

Contact us today for a quote or to discuss your upcoming settlement.