The price of constructing a house in Victoria is escalating faster than in other states due to the fact that supply prices have soared, forcing an increasing number of business failures that have left hundreds of millions of dollars worth of projects in a state of flux.

While clients are demanding designs, builders don’t have enough building materials to complete the projects.

Global supply chain delays prompted by the pandemic have prompted inflationary pressure and delayed the schedule of home building by up to 30 per cent.

The average price of supplies utilised in home building escalated 10.2 per cent in the year to September in Melbourne, compared to 5.9 per cent in Sydney and 8 per cent on average in Australian communities. Steel product prices rose by more than 25 per cent in Victoria.

A major Australian home builder, Melbourne’s Metricon, is taking four months to construct an ordinary 200 square metre, one-storey home that would usually require three months. Some recommend that the federal government open its skilled migration program to elevate labour supply—Metricon sourced timber from Eastern Europe.

Dean Adams, of Alphington-based Hylton Constructions stated that the delays and shortages was reducing his firm’s profit. They are striving to keep clients informed about time schedules and building materials

A trio of major builders – Melbourne-based ABD Group, Brisbane-based Privium and Tasmania-based Inside Out – have entered into liquidation or administration recently, while another 83 construction firms entered administration in September – a one-third increase from the same period last year.

More building was completed in Victoria than in NSW during the lockdown months of 2021.

Queensland’s Privium has left about 170 incomplete projects across Victoria, including a $50 million project to construct 92 townhouses in South Morang. Video

ABD Group halted work on a $140 million project to construct 300 units in Spotswood, and a 25-level residential tower in Footscray. Its subsidiary has stopped work on a 53-unit project in Kew.

The state government commissioned Anna Cronin, the state’s Commissioner for Better Regulation and Red Tape, to look at supply shortages in the sector. The association says the report was given to the government in November and encouraged the government to present the conclusions and discover solutions.


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