NCC 2022: Great Intentions, Real-World Costs — A Builder’s Take

Written by Adib Adely, Director of Carmel Homes

If you build homes for a living, you’ll know the NCC 2022 update is the biggest shake-up we’ve had in years. The aims are solid: more accessible, energy-efficient, and healthier homes. But aims live on paper; budgets live in the real world. In a market already grappling with rising construction costs and a chronic undersupply of affordable housing, it’s fair to ask: should all of these upgrades be mandatory for every new home—or should they be strong guidelines and incentives that households can opt into when it suits their needs and budgets?

Speaking as a design-and-build company that delivers high-end custom homes as well as compact, efficient builds, here’s our balanced view: many of the NCC 2022 ideas are genuinely good. We already design to most of them whenever they make sense for the brief. But we also see how blanket mandates can push projects over the line—from “doable” to “delay it” or “don’t build at all.” And when the community needs more housing, not less, that’s a problem for everyone.

Below we unpack the key changes driving cost and space impacts, what the code actually says, and where we believe better policy design could protect affordability and support better homes.

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Quick refresher: what changed?

NCC 2022 introduced two big buckets that affect houses and apartments the most:

1. Livable Housing (Silver-level): step-free access to the dwelling, wider internal doors and corridors on the entry level, at least one compliant toilet on the entry level, a step-free shower, and reinforcement in bathroom/sanitary walls for future grabrails. These provisions apply to Class 1a houses and Class 2 apartments (inside the SOU). National Construction Code

2. Energy efficiency: the minimum thermal rating lifts to 7-Star NatHERS (or the equivalent DTS/verification pathway), and a new Whole-of-Home energy budget scores your fixed appliances (heating/cooling, hot water, lighting; pools/spas where installed). Importantly, Whole-of-Home is a performance budget, not a single product mandate—there are multiple ways to comply. NatHERSAustralian Building Codes Board

There are also strengthened condensation and roof-space ventilation provisions in cooler climate zones (including Melbourne), plus various clarifications to weatherproofing, drainage and documentation.

In Victoria, the 7-Star and Whole-of-Home provisions commenced 1 May 2024 after a transition period; Livable Housing also applies, subject to the NCC’s concessions (more on that below).

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The affordability lens: mandate vs. guidance

We’ll be upfront: we support the goals—better accessibility, lower running costs, healthier envelopes. But mandating every feature across every new home—including the smallest footprints and steepest sites—shifts costs onto all buyers, including those who would prefer to prioritise bedrooms, location, or simply getting into a new build at all.

Even the government’s own commissioned work shows cost impacts are not zero. An ABCB cost study for the accessible (livable) elements estimated order-of-magnitude increases (Silver level) in the few-thousand-dollar range on typical sites/designs—and that’s before accounting for today’s escalated labour/material rates and project-specific complexities. The same study explicitly assumes exemptions on steep/space-constrained sites to avoid the very high-cost edge cases—which is exactly our point: the real world has edge cases. cpd.nccb.gov.au

Meanwhile, industry and media commentary on the 7-Star uplift and Whole-of-Home has ranged from a few thousand to tens of thousands depending on design, glazing choices, climate zone, and whether on-site solar is added to “balance the budget.” Some analyses cite average upgrades around $4k for the thermal shell in common house archetypes; others—especially for larger glazed homes—land materially higher. The spread is wide because houses and sites vary widely.

All of this lands in a market where finance is tighter, trades are scarce, and materials remain volatile. Pile on blanket mandates, and marginal projects slip—the exact opposite of what we want when the state is pushing for more dwellings.

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Where the big cost/space pressures come from (and how the code really works)

Below we’ve rewritten and expanded our main concerns in plain English. Where relevant, we’ve included what the NCC actually says and how compliance is typically achieved.

1) Step-free access from outside (the “path to the door”)

The intent: At least one step-free path to an entrance door—either from the street boundary, an attached garage/carport, or a dedicated on-site parking space. There are concessions for steep sites or insufficient space. 

Our take: The idea is good—fewer steps help everyone. But there are two real-world frictions:

• Water management at thresholds. Traditional detailing relies on a step-down to stop wind-driven rain. Level thresholds require engineered drainage (e.g., threshold channel drains integrated with the door track) and careful surface falls and membranes to meet the NCC’s damp/weatherproofing requirements. That adds detailing, trades, and cost—especially in exposed locations. It’s doable (there’s specific guidance) but it’s not free. 

• Topography and site planning. On sloping blocks, creating a compliant step-free path can mean retaining walls, longer ramps, or regrading. The NCC recognises this by allowing exemptions for steep/limited space sites. In other words, even the Code acknowledges there are cases where the cost and complexity spike. 

Cost reality: On flat suburban blocks, we commonly allow a few thousand dollars for the threshold/landing/drainage detailing and path upgrades. On steep infill sites, it can escalate significantly with retaining, civil re-grading and bespoke drainage. The ABCB cost study includes allowances for extra waterproofing at level thresholds (because removing the step demands it), but purposely did not model prohibitively expensive steep-site work because the Code’s concessions exist to avoid those edge costs—which is precisely why we argue against blanket mandates. 

Policy suggestion: Keep this as a preferred guideline with incentives, and retain the current concessions. Reserve mandates for targeted housing types (e.g., public/social, SDA), or for lots where complying solutions are straightforward.

2) Wider internal doors and corridors (entry level)

The intent: Make circulation easier by providing wider door clear openings (often achieved with a standard 920 mm door leaf) and corridors ~1000 mm on the entry level to habitable rooms, laundry and the compliant toilet. Thresholds at internal doors are to be level (with minor lips or short ramps permitted). 

Our take: On typical single-storey family homes this is often manageable with minimal plan tweaks. But in compact homes and townhouses, a mandatory 1000 mm corridor can eat precious floor area or force a re-plan that costs more than the door upgrade itself. If the choice is one less linen cupboard or a smaller bedroom to feed corridor width, many clients would rather allocate space to living/bedrooms.

Cost reality: Door leaf upgrades are modest; the space-take is the main cost. The ABCB cost work estimated “Silver” livable features in the low-thousands for typical archetypes (pre-inflation). In small footprints, though, the knock-on re-planning and extra square metres can push costs disproportionately relative to the benefit for households who don’t need the feature. 

Policy suggestion: Encourage width targets as default design guidance, but don’t mandate in small dwellings below a certain floor area unless requested. Offer planning concessions (e.g., site coverage or setbacks) to offset the lost area where owners do opt in.

3) A toilet on the entry level with circulation space

The intent: At least one sanitary compartment (toilet) on the ground/entry level with prescribed circulation space, and wall reinforcement for future grabrails. 

Our take: Sensible in many two-storey homes; we’ve long recommended a powder room downstairs. The pain point is space in small builds—you can’t add circulation space without taking area from somewhere else. For tight footprints, that trade-off is often a real bedroom/living hit.

Cost reality: The carpentry/linings/extra framing for reinforcement and a larger room are not extreme, but again space equals money. On compact homes the percentage impact is noticeable.

Policy suggestion: Make it opt-in for compact dwellings under a threshold floor area, or allow alternatives (e.g., a larger bathroom upstairs plus a downstairs powder without full clearance), unless a client requests full circulation.

4) Step-free (hobless) shower

The intent: At least one hobless, step-free shower in the dwelling, not necessarily on the entry level. The NCC wet-area provisions set out specific membrane, falls and threshold detailing for level showers. 

Our take: We specify hobless showers often—they’re beautiful and practical. But they are more exacting to construct. On slab-on-ground you typically need set-downs or screeds; on timber floors, extra detailing. Done right, they’re excellent. Done poorly, they’re a call-back.

Cost reality: It’s the labour and precision—extra set-down, graded screeds, linear drains, membranes tied to puddle flanges—that add up. It’s not a budget killer by itself, but again, mandating it for every new home, including price-sensitive builds, is questionable when many clients would prioritise bedroom space or kitchen upgrades.

5) Reinforcement to bathroom and sanitary walls

The intent: Put noggins/reinforcement behind walls so grabrails can be added later without tearing the room apart. Not required where walls are concrete/masonry with sufficient capacity. 

Our take: The logic is sound—retrofitting is messy. But in every house? For most families the reinforcement will never be used, yet the cost lands anyway (small per room, large in aggregate across all homes). In terms of social equity, this is where targeted mandates (e.g., social housing) and strong guidance elsewhere might strike a better balance.

6) Whole-of-Home energy budget (and “do I need solar?”)

What it actually is: Whole-of-Home sets a performance budget for your fixed services. You can comply via software rating or elemental provisions. You do not have to install solar PV by rule; many designs choose PV because it’s a straightforward way to meet the budget alongside efficient electric systems (heat-pump hot water, high COP heating/cooling, LED lighting). 

Our take: We’re big fans of efficient envelopes and services. But forcing every project to the same performance budget—regardless of budget, site shading, roof form, or client priorities—removes flexibility. We’d rather see carrots (rebates, planning bonuses, green finance) for high-performance homes, with a solid baseline that keeps affordability front and centre.

Cost reality: On many of our jobs, meeting Whole-of-Home means specifying efficient electric appliances anyway (which is where the market is heading), and often adding PV to stay inside the budget. PV pricing swings, but you’re commonly looking at $5k–$10k for a decent residential system, give or take. That’s real money for first-home builds, even if bills drop later. (Victoria’s shift to 7-Star/Whole-of-Home from 1 May 2024 underscores that the policy is now “live” for most projects here.) 

7) Condensation & roof-space ventilation

The intent: Reduce condensation risk by improving exhaust strategies and, in cooler zones (e.g., Climate Zone 6 around Melbourne), by requiring roof-space ventilation sized to tables in the Housing Provisions. This is more prescriptive than before. 

Our take: As a building industry, we needed this—condensation damage is real. But for eaveless, box-form modern homes, getting compliant, evenly distributed ventilation can require specialised venting solutions and careful detailing across multiple trades. It’s not trivial in looks-driven designs.

Cost reality: On houses with eaves, we’re commonly adding purpose-made vents and verifying free-air areas—usually a few thousand dollars in materials/labour. On eaveless designs, the solutions and labour can jump significantly, particularly when paired with acoustic/ember/sarking requirements. It’s a quality investment—but it’s another line item on a long list.

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“Nice to have” vs “must have”: why execution of existing rules still matters most

One point we can’t stress enough: many issues in new builds are caused by poor execution of existing requirements, not a lack of more rules. The current NCC already has detailed provisions on wet-area waterproofing and damp/weatherproofing; build them incorrectly and you’ll still get leaks—regardless of livable features. Likewise with condensation: ventilation paths, ducting to outside (not to roof spaces), and continuity of membranes matter more than the clause numbers. 

Before we mandate new features for all households, we’d get more bang for buck from:

• Better training and standard details for level thresholds and hobless showers (so when they’re used, they’re done right).

• Clearer, consistent guidance from certifiers on condensation design and roof-space vent calculations.

In short: do the current basics brilliantly. Then, help people choose higher performance and accessibility where it suits.

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What the research says about costs (and why we still see risk)

• The ABCB-commissioned cost analysis for accessible (livable) features estimated Silver-level costs in the low-thousands for typical house archetypes, and explicitly relies on concessions (e.g., steep sites) to avoid modelling prohibitively expensive edge cases. That’s sensible for a regulatory impact statement—but those edge cases exist in real projects, and when you hit one, the costs are not theoretical. 

• For the 7-Star uplift, independent analyses suggest average upgrade costs on some archetypes can be a few thousand dollars, while other industry commentary and media have reported materially higher figures depending on design/glazing and whether PV is added. Bottom line: there’s no single number; it’s project-specific. 

• Whole-of-Home is a budget, not a product mandate. You can comply without PV by specifying very efficient electric systems—but in practice many designs choose PV to get the score across the line at reasonable cost, which effectively shifts upfront cost to the build phase. 

• Adoption timing in Victoria (7-Star and Whole-of-Home from 1 May 2024) means most projects on our books have already shifted to the new settings; this isn’t hypothetical. 

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Our position (and a constructive alternative)

We agree with the direction of travel. We question the wisdom of mandating everything for everyone, right now, during a housing affordability crunch. Here’s a compromise that would still move the market:

1. Targeted mandates where they matter most

   Make livable and Whole-of-Home requirements fully mandatory for:

   • Government-funded housing (public, social) and SDA

   • Larger, higher-budget private projects where space and funds aren’t the main constraint

     
     

2. Guidelines + incentives for everyone else

   Keep the livable features and Whole-of-Home as the default design guidance, and stack incentives on opt-in:

   • stamp duty/fee rebates, Solar Homes style PV rebates, or green loan discounts

   • planning bonuses (e.g., modest site coverage/height concessions) when a build includes a full package of livable and energy features

     
     

3. Smart concessions

   Expand the NCC concessions for steep sites and space-constrained lots—because when these triggers push the design into expensive ramps, retaining, or awkward re-planning, you’re harming affordability for marginal buyers. 

   
   

4. Lift execution quality

   Direct effort (and funding) to training on the details that most often go wrong: waterproofing, flashing, vapour control, and exhaust terminations. The code already protects quality here—doing it right is what really reduces defects. 

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Final word from the site shed

As builders and designers, we love making homes easier to live in and cheaper to run. On many projects we already choose step-free showers, better circulation, and efficient electrics—because it suits the brief and budget. But housing affordability is now the elephant in every room. When every improvement becomes mandatory, the entry ticket to a new home goes up for every household— including those who would prefer a smaller mortgage and one more bedroom over a wider corridor they’ll never use.

Guidelines + incentives meet people where they are, allow choice, and still move the market forward. That’s how we get more homes built, better homes built—and fewer stalled projects.

If you’re planning a new build and want a clear, line-by-line view of how the NCC 2022 settings will affect your specific site and plan—from the step-free path and thresholds to Whole-of-Home and roof ventilation—we can walk you through practical options and realistic costings before you lodge. No jargon, just trade-tested detail.