Buyer’s guide  ·  NSW

Title defects in NSW: unauthorised works, encroachments and boundary issues

Title defects such as unauthorised building works, encroachments and boundary issues can cost NSW buyers dearly. Learn how to spot them and what to do.

Updated October 2026 to reflect current law.

Title defects are problems with a property’s legal title, boundaries or approvals that can affect its value and how you can use it. Common examples in NSW are unauthorised building works, encroachments and boundary issues.

Once you settle, these problems usually become yours. That is why it pays to find them before you are bound to buy.

This guide explains the most common title defects, how to spot them, and what you can do if you find one.

What are title defects?

In everyday conveyancing, “title defects” covers more than problems on the title search itself. It includes physical and approval issues that affect what you are really buying. The three most common are below.

Unauthorised building works

These are works done without the approvals the law required. Examples include extensions, decks, sheds, garage conversions, granny flats or pools.

Not every small structure needs council approval. Some are “exempt development” if they meet strict rules. But if approval was needed and not obtained, the council can issue orders, including orders to alter or demolish the work. The new owner can be on the receiving end.

Encroachments

An encroachment happens when a structure extends over the boundary onto a neighbour’s land (or onto council land, such as a footpath). Encroachments can go unnoticed for years and then cause a dispute when a property changes hands.

Example: John and Peter are neighbours and friends. John builds a carport whose roof extends slightly over the boundary into Peter’s land. Peter does not mind, so nothing is put in writing. Five years later, Peter sells to Stephanie. Her survey shows the encroachment. Because nothing was documented, John has no legal right to keep the carport there, and may have to remove it or negotiate with Stephanie.

In NSW, the Encroachment of Buildings Act 1922 lets either neighbour apply to court where a building encroaches. The court can order compensation, a transfer or lease of the land, an easement, or removal of the encroachment.

Boundary issues

Boundary issues arise when the fences on the ground do not match the legal boundaries. Fences are often slightly off the true boundary. Old or inaccurate surveys can also cause problems. Disputes about boundary fences in NSW are generally dealt with under the Dividing Fences Act 1991.

How can you identify title defects before you buy?

Do these checks before you exchange contracts, or at the latest before your cooling-off period ends.

1. Have a lawyer review the contract documents

In NSW, the seller must attach certain documents to the contract, including a title search, the relevant plan, a planning certificate from council and a drainage diagram. Paper certificates of title were abolished in NSW in 2019. Ownership is now recorded electronically in the Register kept by NSW Land Registry Services.

The title search shows registered interests such as easements (rights for others to use part of the land, such as for drainage), covenants (restrictions on how the land can be used or built on) and mortgages. Your lawyer should explain how each one affects you.

2. Get an identification survey

A registered surveyor can prepare an identification survey. It shows where buildings, fences and other improvements sit compared with the legal boundaries. This is the best way to find encroachments and boundary issues.

If the seller already has a recent survey, ask for a copy. But check that nothing has been built since it was done.

3. Check council records and approvals

Councils keep records of development approvals, construction and occupation certificates, and any notices or orders. Comparing these records with what is actually on the land can reveal unauthorised works. Your lawyer can make these enquiries, and a building inspection can help spot structures that look recent or poorly built.

4. Ask the seller questions

Before exchange, you can ask the seller or agent about approvals, survey reports or boundary disputes. A seller does not have to answer every question. But the seller and agent must not mislead you, and the contract contains statutory warranties about certain matters.

After exchange, your lawyer can also raise formal questions under the contract. See our guide to requisitions on title in NSW.

What can you do if you find a title defect?

Get legal advice early

A property lawyer can tell you how serious the issue is, what it might cost to fix, and what rights you have under the contract and the law.

Negotiate with the seller

Before exchange, you can ask the seller to fix the problem, obtain approval, reduce the price, or add a special condition to the contract. Any agreement must be in writing.

Check your rights under the contract and the law

If the seller failed to disclose something they were required to, you may have a right to cancel (rescind) the contract or claim compensation. These rights often have strict time limits, so act quickly.

Regularise unauthorised works with a building information certificate

Approval generally cannot be given “after the fact” for work already done. Instead, the owner (or a buyer under a contract, with the right paperwork) can apply to council for a building information certificate under the Environmental Planning and Assessment Act 1979.

If council issues one, it generally cannot order the building to be repaired, altered or demolished for 7 years. Council may first require changes to the work. A certificate does not cover everything, such as fire safety or swimming pool barrier orders.

Consider title insurance

Title insurance is offered by private insurers. Depending on the policy, it may cover certain losses from unauthorised works, encroachments or boundary issues that you did not know about. It does not usually cover problems you already know about. Read more in our complete guide to title insurance.

Title defects: summary of checks and fixes

Title defects FAQs

Who is responsible for a title defect after settlement?

Usually the new owner. Once you settle, council orders and neighbour disputes generally become your problem, so find defects before you are bound.

Does a building inspection pick up title defects?

Not on its own. A building inspection reports on condition. It does not check approvals or boundaries. You need a survey and council checks as well. See our guide to building inspections in NSW.

Is a fence always on the boundary?

No. Fences are often slightly off the true boundary. Only a survey by a registered surveyor can confirm where the boundary is.

Can I pull out of a contract because of a title defect?

It depends on the defect, what was disclosed and the timing. You may be able to rescind during cooling-off or under the contract or legislation. Get advice quickly, as time limits are strict.

This article is general information only and is not legal advice. It reflects NSW law at the date of publication. Please contact us for advice about your circumstances.

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