HomeBuilder construction commencement extension solves part of the puzzle – but many pieces still missing

20 April 2021

BUILDERS have welcomed the Morrison government’s decision to extend its HomeBuilder construction commencement timeframe – but the industry continues to fight to solve trade and materials shortages and soaring prices.

After months of Master Builders’ lobbying, federal Housing Minister Michael Sukkar has rubber-stamped the extension, which will give builders 18 months to start work on those contracts signed in response to the HomeBuilder grant.

Treasury statistics reveal Queensland had the second highest number of applications across the lifetime of the grant, which closed on March 31, with 26,293 new home buyers and renovators applying out of the total 121,363 applications submitted nationally.

Master Builders Deputy CEO Paul Bidwell said the time extension, which was previously six months, would give the industry further breathing space in what’s a pressure-cooker environment.

HomeBuilder did the job it was created to do. It stopped our industry plunging off the cliff it was headed for even prior to the pandemic throwing a sucker-punch at our economy,” Mr Bidwell said.

“The demand on our industry has been huge, and created the first-class problems of trade and materials shortages, and rising prices.

“This extra time will take some of the pressure off builders, helping them fulfil their promise to start work for their customers so they are still eligible for the $25,000 or $15,000 grant, depending on when the contract was signed.”

However, Mr Bidwell said, that perfect storm of problems is continuing to rage – and growing in ferocity.

“The extension doesn’t come close to solving our woes.

“We already know delivery times on timber and steel supplies are stretched, with prices going up by more than 15 per cent, and roofers especially are hard to find because they’re busy with both insurance work, new builds and renovations.

“We’re now hearing there’s a shortage of concrete pipes which is impacting on land developments, with a minimum wait of 14 weeks, and anywhere upwards of 18 to 20 weeks, depending on the product.

“There are currently only two producers in the market, after one closed down last year, and they can’t keep up with demand, as some engineering contractors are pre-ordering before they’ve even won a job to try and beat the clock.

“It’s great builders have more time to turn the first sod, but those pipe shortages mean that land can’t be developed. A house can’t be commenced until the land has been developed, and the title issued.”

Master Builders Queensland will meet with state government officials later this week to further discuss possible solutions, including more flexibility for builders to use extension of time provisions in existing contracts, and access to mediation if things go wrong, to ensure fairness for industry and consumers.

“This situation is shaping up to be a profitless bubble, and there are no winners here,” Mr Bidwell said.

“We don’t want our builders going bust – and at the same time, home buyers can’t afford to pay the price.”

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