In this study, in order to evaluate adequacy of considering local site effect, excluding soil-structure interaction (SSI) effects in inelastic dynamic analysis and design of mid-rise moment resisting building frames, three structural models including 5, 10, and 15 storey buildings are simulated in conjunction with two soil types with the shear wave velocities less than 600 m/s, representing soil classes $D_e$ and $E_e$ according to the classification of AS1170.4-2007 (Earthquake actions in Australia) having 30 m bedrock depth. Structural sections of the selected frames were designed according to AS3600:2009 (Australian Standard for Concrete Structures) after undertaking inelastic dynamic analysis under the influence of four different earthquake ground motions. Then the above mentioned frames were analysed under three different boundary conditions: (i) fixed base under direct influence of earthquake records; (ii) fixed base considering local site effect modifying the earthquake record only; and (iii) flexible-base (considering full soil-structure interaction). The results of the analyses in terms of base shears and structural drifts for the above mentioned boundary conditions are compared and discussed. It is concluded that the conventional inelastic design procedure by only including the local site effect excluding SSI cannot adequately guarantee the structural safety for mid-rise moment resisting buildings higher than 5 storeys resting on soft soil deposits.