The crisis facing Australia’s residential construction industry continues to worsen.
So far this year, we have witnessed several high profile residential builders collapse. These include major players like ABG Group, Privium, Probuild and Condev, alongside smaller firms like Home Innovation Builders, Next and Hotondo Homes Hobart.
Yesterday it was reported that one of Queensland’s biggest home builders – Pivotal Homes – has also gone into liquidation, leaving more than 200 new home builds in limbo:
Sunshine Coast building company Pivotal Homes, once a sponsor of the Gold Coast Titans, went into liquidation late on Thursday.
Managing director Michael Irwin said rising labour and construction costs had strangled the business.
“In my 30 years’ experience I have never seen a set of circumstances like this and obviously we are not alone in these unfortunate conditions facing the industry,” he told the Courier Mail…
Sunshine Coast building company Pivotal Homes, once a sponsor of the Gold Coast Titans, went into liquidation late on Thursday.
Managing director Michael Irwin said rising labour and construction costs had strangled the business.
“In my 30 years’ experience I have never seen a set of circumstances like this and obviously we are not alone in these unfortunate conditions facing the industry,” he told the Courier Mail.
To add further insult to injury, construction giant Metricon continues to teeter on the edge of “imminent collapse”. Accordingly, the NSW Government is preparing a rescue package for ‘too-big-to-fail’ Metricon and the industry:
The NSW government at its most senior levels is scrambling to finalise a twin rescue package for the state’s building industry and customers of construction giant Metricon amid fears the company is at imminent risk of collapse…
One option being examined is a rescue package at a cost of hundreds of millions of dollars that would shore up industry players at risk of collapse due to a confluence of factors, including the pandemic, rising material costs, recent flooding and labour shortages…
A second package would be targeted at Metricon to complete some 300 active construction sites, or compensate buyers of house and land packages that may not be able to be completed.
Sources familiar with the company’s finances who spoke on condition of anonymity said cashflow remained dire and, without assistance, the business was teetering on the verge of bankruptcy.
While I feel sorry for builders grappling with soaring costs, this looks to be another case of “privatise the profits and socialise the losses”.
It is a shame the billions of taxpayer dollars spent on HomeBuilder stimulus and industry bailouts weren’t instead invested in social housing projects.
