Central Queensland building boom leading to bust after exorbitant price hikes

Some builders are reporting 10 to 15 per cent price rises in materials and with clients locked in fixed price contracts, the builders are forced to cop the price increases

Builders and tradespeople across the Rockhampton and Capricorn Coast are in high demand with long waits for work and a surge of out of town tradies descending on the region.

While it might be thought building businesses would be raking in good profits, price rises in materials and supplies has meant some local businesses are facing an unprofitable boom.

Thanks to the Federal Government HomeBuilder grants, building supplies have been in high demand across the country.

As the demand increased, the supply has not been able to keep up.

And what has been available has gone up in price.

Homeowners may have signed a contract with fixed prices of supplies but as prices have rapidly risen for supplies and materials, this extra price has to be copped by the builders.

Master Builders Queensland Central Queensland regional manager Michelle Traill explained someone could have signed a contract in November and in some instances, the prices of materials and supplies have since gone up by 10 to 15 per cent.

Most wholesalers are refusing to guarantee fixed six-monthly agreements are only quoting fixed monthly pricing.

“I’ve signed contracts, now the suppliers can’t honour the quotes I have accepted,” one Master Builders member reported.

Getting supplies and materials has also been another issue, albeit at a much higher cost.

Some builders have reported a months’ wait for timber orders, and locally the biggest wait has been for roofing supplies and coloured glass.

Master Builders members, of which Central Queensland has 407, have reported it as a crisis and the worst they have ever seen.

As prices rise and the lack of supplies continues to escalate, some are reporting the boom-bust bubble will send some businesses to the brink.

“Not being able to get the materials pushes out the build time, it skews the sequence of trades you have when you build a home,” Ms Trail said.

There is also a trades shortage with roofers, skilled and qualified carpenters, tilers and waterproofers all in high demand.

“There are instances of builders doing in fly in and fly out,” she said.

“The whole state is busy, there is a shortage across the state.”

Ms Traill estimates there is a pipeline of two years’ of building work to be done.

The boom started in November last year.

“The perfect storm was HomeBuilder, people being able to withdraw superannuation, low interest rates, interstate migration and people returning from overseas with money,” she said.

Offering advice to those who might be building a new home or getting building work done, Ms Traill said to have regular open and honest communication with your builder.

“The builders are working really hard to fulfil their contracts, just have an understanding the industry is under pressure,” she said.