Nirimba residents hit with building cost increases

Residents building homes in Caloundra South are warning future home-builders to watch and prepare for a clause in contracts that may add up to 30 per cent to building costs.

Building construction. generic. Photo: Brett Wortman / Sunshine Coast Daily

Sunshine Coast residents building homes in the region’s largest new estate say they have been hit with substantial cost increases on building contracts they believed were fixed price.

Nirimba resident Adam Hoyle said he was shocked when the company building his home called to say he would need to find an extra $19,900 to finish construction.

“We got the shock of our lives, we were told it was fixed price when we put our deposit on, so we were very disappointed when we go the increase,” Mr Hoyle said.

“I was shocked and angry at first but there is absolutely nothing I can do, it killed us it put a hell of a lot of pressure on us.

“I really wish I knew there could be variables involved, it would have been easier to take and budget for because it is a lot of money to fork out, especially while we are paying rent and storage units too.”

Adam Hoyle was notified an extra $19,900 would be needed to finish construction on his house in Nirimba.

Mr Hoyle said he understood there are still issues surrounding importing materials and labour, but he would like to warn other people to expect additional costs on building contracts.

“I wouldn’t like to put people off but maybe just expect these increases,” Mr Hoyle said.

“I would have dropped down $50,000 in the original loan if I knew.”

Another Nirimba resident said they had a similar experience to Mr Hoyle after a 30 per cent increase on the initial building cost was added about four months after they signed a contract with Thompson Building Group.

“Two years ago we started (building), we had final plans drawn up and everything, then they said they needed 30 per cent more than they had initially quoted us,” they said.

“I asked for a description of why that had happened, I wanted to know exactly what had gone up, they couldn’t provide any info so I pulled out.”

Both residents said they found it frustrating when they were denied to see the breakdown of the cost increases.

Rooftops in a new housing development.Photo: Brett Wortman / Sunshine Coast Daily

However, those in the building sector maintain the increases are necessary for the survival of smaller construction businesses as labour and material issues remain.

Thompson Building Group said the increases they passed onto clients in the Nirimba area did not benefit them as a small business and were due to increased costs out of their control.

“TBG sympathises with our clients during these tough times, the terms of our HIA contracts include adjusted build periods to account for delays in the construction industry resulting from COVID-19 and including but not limited to the restricted supply and increased cost of materials and the dramatic shortage of labour experienced by all builders, not just Thompson Building Group,” a statement from the group said.

Thompson Building Group added their clients were made aware of this clause in the contract.

Master Builders Sunshine Coast regional manager Nicola Scott said there were still reasons additional costs may be introduced by builders after a contract has been signed.

“The cost of building a home in Queensland jumped 20 per cent in the last year, and an eye watering 42 per cent over the past three years. A number of factors contributed to this, Covid-19 supply chain disruptions, a global surge in demand for building materials, international events and severe weather events,” Ms Scott said.

“For fixed price contracts that had already been entered, builders are continually having to absorb the cost, resulting in lost profit.”