Taxpayers could be left with $28m bill if Metricon collapses

Taxpayers could pay up to $28 million to bail out hundreds of families left with unfinished homes if Metricon collapses. But the home building giant says the business is strong.

Taxpayers may end up forking out up to $28 million to bail out hundreds of families left with unfinished homes because of home building giant Metricon’s troubles.

But the nation’s biggest home builder says the business remains strong following the sudden death this week of founder Mario Biasin.

The company has been in crisis talks with the Victorian government about their ability to complete projects amid spiralling building material costs and labour shortages.

Senior government sources and former HIA chief economist Harley Dale fear the Home Building Compensation Fund could be overwhelmed by 350 NSW homeowners who may make claims for unfinished work.

The fund covers people for up to 20 per cent of the contract cost. With the average build in NSW costing around $400,000 and Metricon having 350 active construction sites around the state – the bill could be huge.

Young mum Nancy Larrondo, husband Joseph Duffell and their 10-month-old boy Oliver. Picture: Supplied

“This situation could potentially reveal some shortcomings in how the fund is managed,” a senior government source said.

“There is also a concern about financial implications for people who have purchased options to build on lots that are not yet registered or subdivided.”

Mr Dale said: “There will be a heightened risk of adverse consequences to the fund should a company like Metricon find themselves in substantial trouble.”

NSW Fair Trading Minister Eleni Petinos said: “The Office of the Building Commissioner, NSW Fair Trading, SIRA and icare HBCF are working closely on this issue to fully understand the situation, risks and potential impact.

“The NSW government appreciates the scale of this matter, given Metricon is the third-largest builder of homes in NSW.”

NSW Fair Trading Minister Eleni Petinos.

Metricon acting CEO Peter Langfelder said the company was a long-term, viable business.

“All our contracts are profitable, and we are up to date with all our payments: to contractors, suppliers, employees and trades,” he said.

“We have a strong and positive relationship with our bankers, and all facilities are in term and with headroom.”

Nancy Larrondo was so stressed dealing with troubled builder Metricon her baby boy Oliver arrived eight weeks early.

Ten months on and Ms Larrondo and husband Joseph Duffell say they are at their wits’ end wondering if their new home will ever be finished.

“We were supposed to pick up the keys this week, but instead our new home doesn’t have a roof on it,” the Fairfield West woman said.

“I’ve been calling the company this week but all they give us are these robotic answers in regards to what happened with the confusion.”

Nancy Larrondo and Joseph Duffell’s home in the making.

The couple say their problems started in October 2020 when they left a deposit for a $487,000 home plus a granny flat in Silverdale, near Warragamba.

They claim the company insisted they were able to build a granny flat despite concerns about the new Western Sydney Airport restricting the permissibility of secondary dwellings.

When the company released nine months later that granny flats were not permissible, Metricon slugged them an extra $22,000 for a new airconditioning and filtration system and acoustic report.

Since then they have dealt with a list of issues.

Now, with the company in the news, the couple are concerned their home will not be finished.

“They say every week that their workers will come by on Monday … but months later they’re still trying to fix the problems,” she said.

“We’ve got no idea when the property will be finished.

“I am just anxious, I don’t know what to believe. We want to stay positive but we are concerned about what will happen to the company.”

Metricon said they had allowed the customer-requested variations “which resulted in all documentation needing to be amended, from plans, engineering and certifications”.

“Metricon has been arranging all of these elements for Nancy and Joseph and this is on track to soon be finalised,” NSW general manager Patrick Eather said.

“At each stage of the sales process, Metricon customers sign off plans to ensure they have appropriate time to check all inclusions are as per their request.”

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