If the building department are aware of illegal modifications, basically its already in the system, and I'd check the title to see if there is a notification mentioned, because if you are borrowing money from the bank, and they discover there is a building department notice on the title, they won't lend on the property.
If you are not borrowing money to buy the property, then it may not matter until you decide to sell to a buyer who needs to borrow to buy, but I'd check with your lawyer who will handle your conveyancing. Better to be on the safe side, or you may face difficulty when you wish to sell.(later down the track )
We have bought property with ( non dangerous ) illegal structures before, but they hadn't progressed to the point of having a BD notification listed on the title, which never hindered our purchase or sale later on.
Sorry I couldn't add any further info than that.