Want to build a new home? It could cost you 20 per cent more

Rockhampton builder Sonny-Jim Fulton doesn’t mince his words on the state of the house construction industry.

“Oh, it’s chaos, chaos,” he said.

The ongoing severe shortage of building materials, combined with the demand for skilled tradespeople, has sent new home build costs soaring up 20 per cent in Queensland over the past 12 months, according to a September survey by Master Builders.

It’s a problem that won’t be fixed by reopening the state and national borders either.

Master Builders deputy chief executive Paul Bidwell predicts the new year could be a tipping point.

“The implications are dire. So far, we’ve not heard of any builders going to the wall as a result, but based on conversations we’re having with builders, it will happen, [and] most likely early in the new year,” he said.

“While opening the borders may ease some of the pressure on trades, it won’t solve our material shortages woes.

“Unfortunately, there’s no silver bullet.”

Projects stall

Mr Fulton is finishing off three new homes in the Rockhampton region that he began in 2020 and he has not signed a new house building contract since October of that year.

He said all his goals had gone out the window.

“We don’t even make a plan until I get out of bed at 5am in the morning,” he said.

“It’s multiple projects going all at once. But we can’t get them finished because the material shortages, ordering stuff and making stuff and staff shortages is just killing us.

“It’s too deep for everyone.”

Mr Fulton was forced to find other work when his projects stalled as building materials ran short.

“We went roofing because we couldn’t get materials like timber, but then iron ran out,” he said.

“Then we jumped back to framing when the timber turned up. Then we juggle around with the material delays with that and then, when we finished the framing, we go back roofing.

“We just go backwards and forwards, piggyback off each other because we know with the delays, you have just got to stretch yourself out.”

Profitless boom

Central Queensland Master Builders manager Michelle Traill said builders were enduring a “profitless boom” because of the insatiable demand for new homes nationwide.

She said on top of demand for timber, bricks and roofing supplies, prices for structural bearers and joists were up by more than 60 per cent this year.

Furthermore, Ms Traill said the lack of qualified tradespeople was also widespread, not just for carpenters and roofers.

“Concreters and bricklayers are also in short supply,” she said.

“As we move into residences that are going through the build process, it’s the finishing trades — tilers, the painters.”

Ms Traill said the flow-on effect for builders’ cash flow was significant.

“There’s lots and lots of variables in the mix in this critical situation.

“We are making sure that we can do whatever we can to support builders, so there aren’t unfortunate closures of businesses.”

Builders big and small struggling

Mr Bidwell hasn’t ruled out the possibility of businesses folding in the coming months.

He said the supply and cost issues were forecast to run well into 2022.

“Builders big and small continue to struggle with the fallout from the ‘perfect storm’ – the boom in demand off the back of HomeBuilder and the Regional Home Building boost grant, combined with low interest rates and record interstate migration,” Mr Bidwell said.

“There are a lot of very frustrated builders and clients out there – mostly in the housing sector, but the commercial sector is not immune.”

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