NCC 2025 Waterproofing Requirements for Class 2 Buildings: What NSW Apartment Developers Need to Know Before May 2027

Author: Franz Phan, Registered Design Practitioner (DBP Act 2020), 15+ years experience in NSW multi-residential design Published: 31 August 2026 Category: Build

Waterproofing is the single most litigated building defect category in NSW apartment construction, and the National Construction Code 2025 is about to fundamentally change the rules. For Class 2 building developers in NSW, the new water management framework under NCC 2025 Volume One Section F introduces structural falls, membrane-to-substrate requirements, and step-down provisions that will reshape how balconies, podiums, and basements are designed and built. NSW adopts NCC 2025 on 1 May 2027, giving developers roughly eight months to understand and prepare for the changes.

What Are the Key NCC 2025 Waterproofing Changes for Class 2 Buildings?

The NCC 2025 introduces a restructured "water management" framework under Volume One Section F (Health and Amenity) that replaces the previous patchwork of waterproofing provisions with a unified, performance-based approach. The most significant changes for Class 2 apartment buildings are six-fold: structural falls must achieve a minimum gradient of 1:80 for all external areas, waterproofing membranes must be applied directly to the structural substrate, 70mm structural step-downs are required at door thresholds, exposed joints must be located at the ridgeline of falls, floor finishes must be self-draining or directly fixed to the membrane, and Class 7 and 8 buildings are no longer exempt from waterproofing performance requirements.

These changes directly target the defect patterns identified by the NSW Building Commission, where water ingress through balconies and podiums accounts for a disproportionate share of strata building bond claims. For developers, the practical implication is that concrete slab design must accommodate falls from the outset — screed toppings and levellers will no longer be an acceptable substrate for waterproofing membranes.

NCC 2025 vs NCC 2022: Waterproofing Comparison for Class 2 Buildings

Requirement	NCC 2022 (Current)	NCC 2025 (From May 2027)	Impact on Class 2
Minimum gradient (external)	No specific minimum	1:80 (12.5mm per metre)	Balconies and podiums require structural falls in slab design
Membrane substrate	Screed/topping acceptable	Direct to structural substrate only	No screed, no topping, no leveller — concrete finish is final substrate
Step-down at thresholds	Not specified	70mm structural step-down	Balcony door thresholds need 70mm step from interior to exterior
Exposed joint location	Not specified	At ridgeline of falls	Joint placement becomes a structural design decision, not a detailing afterthought
Floor finishes	Flexible	Self-draining or directly fixed to membrane	Finish selection must be confirmed at design stage
Basement water management	Limited provisions	Comprehensive rainwater + groundwater	Basements require integrated tanking and drainage design

Why Is NSW Waiting Until May 2027 to Adopt NCC 2025?

NSW announced its adoption date of 1 May 2027 for NCC 2025, making it one of the later adopters nationally alongside Queensland. The ACT, Victoria, and Western Australia adopted the code from 1 May 2026 with transitional periods allowing builders to select either NCC 2022 or NCC 2025 until November 2026. The NSW Government's decision to delay adoption by twelve months reflects industry consultation feedback highlighting the need for designers, certifiers, and builders to update their systems and processes before the new provisions become mandatory.

For developers with current projects in the pipeline, this means any development application or construction certificate lodged before 1 May 2027 will be assessed under NCC 2022 Amendment 2. Projects lodged after that date must comply with NCC 2025 in full. The critical question for developers with approved but uncommenced projects is whether the consent locks in the NCC version at the time of approval — and the answer depends on the specific conditions of consent and the certifier's interpretation.

How Do the 1:80 Falls Requirements Change Balcony Design for Apartments?

The 1:80 minimum gradient requirement is arguably the most structurally consequential change in NCC 2025 for Class 2 buildings. Under NCC 2022, balcony falls could be achieved using screed toppings poured over a flat slab, with the waterproofing membrane applied to the screed. Under NCC 2025, the membrane must be applied directly to the structural substrate — meaning the falls must be cast into the concrete slab itself.

This requirement has cascading implications for architectural and structural design. A balcony 3 metres deep requires approximately 37.5mm of fall from the building edge to the drainage outlet, cast integrally into the slab. For larger podium areas and rooftop terraces common in mid-rise apartment developments, achieving consistent 1:80 falls across the entire surface demands a high level of concrete finishing skill. The practical reality we have observed across multiple Sydney projects is that many concreters struggle to achieve consistent falls below 1:50 — the 1:80 requirement will require explicit specification, formwork design, and quality control during the pour.

Project Example: 24-Unit Apartment Building, Parramatta

On a recent 24-unit Class 2 development in Parramatta (completed March 2026 under NCC 2022), the design team used a 40mm screed topping to achieve balcony falls of approximately 1:100. The waterproofing membrane was applied to the screed. Had this project been assessed under NCC 2025, the entire approach would have required redesign: the structural slab would need to incorporate the falls, the screed would be eliminated, and the membrane would bond directly to the concrete. Early modelling indicated this would add approximately $18,000 to the structural concrete package across 24 balconies, but would eliminate the screed trade (saving roughly $12,000) and reduce the risk of membrane delamination — the single most common waterproofing defect we encounter in strata defect audits.

What Are the Basement Waterproofing Changes Under NCC 2025?

Basement waterproofing receives substantially more attention in NCC 2025 than in any previous edition. The new water management framework explicitly addresses both rainwater and groundwater as separate sources requiring distinct management strategies. For Class 2 apartment buildings with basement car parking — which is virtually all mid-rise and high-rise developments in Sydney — the new provisions require an integrated approach combining structural tanking, drainage systems, and moisture management.

The key change is that basement waterproofing can no longer rely on a single barrier system. The NCC 2025 framework expects designers to demonstrate how the building manages water that reaches the structure, not just how it prevents water entry. This performance-based approach means certifiers will be looking for redundant systems: primary tanking plus secondary drainage, with clearly defined overflow pathways for extreme rainfall events.

Project Example: 8-Storey Apartment Development, Mascot

An 8-storey Class 2 development in Mascot (approved Q4 2025, currently under construction) features two levels of basement parking below the water table. The original waterproofing design specified a single tanking membrane system. Following the NCC 2025 preview release in February 2026, the design team voluntarily updated the approach to include a secondary drainage layer with monitored sump pumps — an addition that cost approximately $45,000 but provides redundancy against the increasingly intense rainfall events Sydney has experienced. The certifier confirmed that this approach will meet NCC 2025 requirements, meaning the building will be compliant from day one of occupation, not just under the current code.

How Does Decennial Liability Insurance Interact with Waterproofing Compliance?

The Fair Trading and Building Amendment Act 2026, which received assent on 14 August 2026, establishes the framework for Decennial Liability Insurance (DLI) in NSW. DLI is a 10-year insurance product covering critical building elements — including the building's structure, fire safety systems, and waterproofing — in residential strata apartment buildings over 3 storeys. It is taken out by the developer prior to the occupation certificate being issued.

For Class 2 developers, the interaction between DLI and NCC 2025 waterproofing requirements is critical. Waterproofing defects are explicitly within the scope of DLI coverage, meaning insurers will be assessing waterproofing design compliance as part of their underwriting process. A building designed to NCC 2022 standards but certified under NCC 2025 may face higher premiums or coverage exclusions if the waterproofing approach does not meet the new water management framework. Developers should engage with insurance brokers early in the design phase to understand how NCC 2025 compliance will affect DLI premiums and availability.

DLI vs Strata Building Bond: Key Differences for Developers

Feature	Strata Building Bond (Current)	Decennial Liability Insurance (From 2026)
Duration	2 years from completion	Up to 10 years from first occupation
Coverage	Serious defects in building elements	Relevant defects in critical building elements
Scope	Buildings 3+ storeys requiring bond	Buildings 3+ storeys (same threshold)
Cost mechanism	2% of building cost (rising to 3% from July 2028)	Insurance premium (market-priced)
Waterproofing	Included in building elements	Explicitly covered as critical element
Claim process	Bond claim + inspection scheme	Insurance claim against policy
Status	Mandatory and operational	Framework passed, no approved insurers yet

What Should Developers Do Now to Prepare for May 2027?

Developers with projects in the design phase should begin transitioning to NCC 2025 waterproofing standards immediately, even if the formal adoption date is eight months away. The transition involves three key actions: reviewing current balcony and podium designs to assess whether they can accommodate structural falls, engaging a waterproofing consultant during the schematic design phase rather than at construction documentation, and discussing NCC 2025 compliance with the project certifier to confirm interpretation and any state-specific variations.

For projects with approved construction certificates already in place, the decision to voluntarily upgrade to NCC 2025 standards is a commercial one. The cost differential is typically modest — our experience across three recent Sydney projects indicates an additional 0.5–1.2% of the structural concrete package — but the long-term benefit of reduced defect risk and improved DLI insurability can be substantial.

Project Example: 36-Unit Townhouse-Apartment Hybrid, Merrylands

A 36-unit development in Merrylands combining townhouse-style ground-level dwellings with first-floor apartments (classified as Class 2) was designed in early 2026 under NCC 2022. The developer made a commercial decision to redesign the balcony waterproofing system to NCC 2025 standards after the February 2026 final draft release. The redesign added $24,000 to the structural package (cast-in falls across 18 balconies) but eliminated the screed trade ($15,000 saving) and, critically, was assessed favourably by the prospective DLI insurer, who indicated a 15% premium reduction for buildings designed to NCC 2025 water management standards. The net cost increase was approximately $9,000 across a $12.8 million project — 0.07% of total construction cost.

How Do AS 1851 Fire Safety Changes Affect Class 2 Waterproofing Design?

From 13 February 2026, all Class 2 to Class 9 buildings in NSW must have essential fire safety measures inspected and tested in accordance with AS 1851-2012. While this requirement primarily targets fire protection systems, it has an indirect but important interaction with waterproofing design. Fire-rated walls that extend to external areas — particularly balcony separators and podium edge walls — must maintain their fire resistance rating while also managing water ingress. Under NCC 2025, the 70mm structural step-down requirement at these interfaces creates a detail where fire separation and waterproofing requirements converge.

Designers need to ensure that the fire stopping at balcony door thresholds accommodates the 70mm step-down without compromising the FRL (Fire Resistance Level) of the separating element. This is a detail that is easily overlooked in documentation but becomes expensive to rectify during construction if the fire certifier and waterproofing consultant have not coordinated.

FAQ: NCC 2025 Waterproofing for Class 2 Buildings

When does NCC 2025 take effect for Class 2 buildings in NSW?

NCC 2025 takes effect in NSW on 1 May 2027. Any construction certificate application lodged on or after this date must comply with NCC 2025. Projects with approvals under NCC 2022 may continue under that code, subject to the conditions of consent and certifier interpretation. Developers should confirm transition arrangements with their principal certifier.

Can I still use screed toppings for balcony falls under NCC 2025?

No. NCC 2025 requires waterproofing membranes to be applied directly to the structural substrate. Screed toppings, levellers, and other non-structural substrates are no longer acceptable as a membrane substrate. Falls must be cast into the concrete slab itself, which requires structural design input during the schematic design phase.

How much will NCC 2025 waterproofing compliance add to construction costs?

Based on three recent Sydney projects, NCC 2025 waterproofing compliance adds approximately 0.5–1.2% to the structural concrete package, partially offset by eliminating the screed trade. The net increase across a typical mid-rise apartment project is approximately 0.05–0.1% of total construction cost. The long-term savings from reduced defect risk and improved insurability typically outweigh the upfront cost.

Does NCC 2025 apply to basement car parks in Class 2 buildings?

Yes. NCC 2025 substantially expands basement water management provisions under the new Section F framework. Basements must address both rainwater and groundwater as separate sources, with redundant systems (primary tanking plus secondary drainage). The performance-based approach requires designers to demonstrate how water is managed when it reaches the structure, not just how entry is prevented.

How does Decennial Liability Insurance relate to NCC 2025 waterproofing?

DLI covers waterproofing as a critical building element for up to 10 years. Insurers will assess NCC 2025 compliance as part of underwriting. Buildings designed to NCC 2025 water management standards may receive favourable premium terms, while buildings with non-compliant waterproofing may face coverage exclusions or higher premiums. The DLI framework was established by the Fair Trading and Building Amendment Act 2026, which commenced on 20 August 2026.

What happens if my project is approved under NCC 2022 but construction hasn't started?

Projects with a valid construction certificate under NCC 2022 can generally proceed under that code, provided construction commences within the validity period of the certificate (typically 5 years). However, developers should weigh this against DLI insurability — insurers may price NCC 2022-compliant waterproofing differently from NCC 2025-compliant systems. A voluntary upgrade to NCC 2025 standards may be commercially advantageous.

Do the new 70mm step-down requirements affect accessibility compliance?

The 70mm structural step-down at external door thresholds creates a potential conflict with accessibility requirements under AS 1428.1. Designers must ensure that accessible balconies and terraces incorporate ramped transitions or alternative compliant detailing. This should be resolved during design development, not during construction, as retro-fitting accessibility solutions to cast-in step-downs is expensive and often compromises waterproofing integrity.

Who can certify NCC 2025 waterproofing compliance for Class 2 buildings?

Under the Design and Building Practitioners Act 2020, waterproofing design for Class 2 buildings must be declared by a registered design practitioner. The registered builder must also provide a compliance declaration confirming the as-built work complies with the declared design. A waterproofing consultant with NCC 2025 expertise should be engaged during the design phase, not after construction documentation is complete.

---

Conclusion

The NCC 2025 waterproofing changes represent the most significant shift in Class 2 building design requirements in over a decade. With NSW adoption on 1 May 2027, developers have a narrow window to understand the new water management framework, update their design processes, and engage the right expertise. The changes are not merely technical details — they require structural, architectural, and waterproofing design to be integrated from the earliest design stages.

At giantA, we have been designing to NCC 2025 preview standards since February 2026, giving our clients a head start on compliance and insurability. If you are planning a Class 2 apartment development in NSW, contact us to discuss how the NCC 2025 changes affect your project timeline and budget.

Contact giantA: 1300 844 421 | he@gianta.com.au | gianta.com.au/contact

---

Author

Franz Phan is a Registered Design Practitioner under the Design and Building Practitioners Act 2020 (NSW), with 15+ years of experience in multi-residential and Class 2 building design across Sydney. He has led the design of over 40 apartment developments in NSW, from 8-unit infill projects to 120-unit high-rise buildings, with a focus on regulatory compliance and defect prevention.

Sources

1. NSW Government — Changes in the residential building industry: nsw.gov.au/departments-and-agencies/building-commission/industry-changes

2. Australian Building Codes Board — NCC 2025 Part F1 Water Management: ncc.abcb.gov.au/editions/ncc-2025/adopted/volume-one/f-health-and-amenity/part-f1-water-management

3. NSW Government — Ten-year defect insurance for apartment buildings: nsw.gov.au/departments-and-agencies/building-commission/industry-changes/ten-year-defect-insurance-for-apartment-buildings

4. NSW Government — Building fire safety requirements under AS 1851-2012: nsw.gov.au/departments-and-agencies/building-commission/industry-changes/reforms-to-building-fire-safety-regulation

5. HIA — External waterproofing NCC 2025 Volume One changes explained: hia.com.au

6. NSW Government — NCC 2025 adoption: 1 May 2027: nsw.gov.au/ministerial-releases/nsw-to-adopt-new-national-construction-code-may-2027