David Hallett, General Manager of Archicentre, the building advisory service of the Australian Institute of Architects said, in a recent case a house actually fell into the block next door during excavations and in Sydney a restaurant collapsed into an excavation next door in the city.

"In inner suburban areas often older homes are being demolished to be replaced with townhouses, apartments or one very expensive property built on the land. Many of these redevelopments involve extensive deep excavation across a large section of the land to allow for the foundation structures, underground car parking and storage facilities.

"One of the most dangerous times is when deep excavations are taking place on the boundary in city and suburban areas and there is heavy rain which can change soil conditions quickly.

"Climate change projected weather forecasts are that we will get less days of rain, however the rainfall will be more severe which can change the situation on a major boundary excavation very quickly.

"A major slip can cause financial disaster for both the owner of the property being renovated or built and the neighbour as it usually ends in a major costly legal dispute involving all parties.

"The current economic climate may also create a major problem when after these deep excavations are created the developer may delay the project because of financial stress."

Mr Hallett said an owner who is proposing building work has obligations to protect the adjoining property from potential damage from their work. Archicentre is increasingly being called in to undertake status reports on neighbouring properties.

"A status report carried out professionally on neighbouring houses records all existing defects to allow the tracking of any new damage which may occur during the construction period."

The Archicentre status report records the condition of the home photographically combined with an extensive written report and provides protection for all parties concerned - the builder, the owner and the neighbour.

"If building work is close to or adjacent to adjoining property boundaries, then an owner may be required to carry out protection work in respect of that adjoining property. Some protection work includes extensive propping of fences and walls with pylons and large support beams where the excavation is on the boundary.