Homeowners warned: resist urge to do it up

Homeowners around the country are being warned against picking up renovation tools right now as strong demand pushes costs higher.

Seasoned renovators Stu Balding, 52 and Tonya Scheiwe, 50, in their newly renovated home in Hendra, north Brisbane. Picture: Lyndon Mechielsen

Homeowners around the country are being warned against picking up renovation tools right now as strong demand pushes costs higher.

Renovations currently represent the strongest portion of the residential building world, coinciding with a broader construction boom. This is having a flow-on effect to the price of mat­erials and the ability to secure trades people.

In the past year, the value of home renovations hit a 21-year high on the back of low lending rates and pandemic stimulus, such as HomeBuilder. Australian Bureau of Statistics data showed $2.87bn was spent on property alterations and additions in the year to July, up 24.5 per cent on last year.

Timber is causing the biggest headaches, said Master Builders Australia chief executive Denita Wawn. While general product delays nationally are sitting around three weeks on average, timber deliveries are about eight to 10 weeks behind, with some reports of up to three months.

The average cost of product and trade is also up between 8 per cent and 11 per cent respectively.

“Lockdowns and hard borders are making building product and skilled trade shortages and delays worse by restricting movement and import of goods and labour,” Ms Wawn said.

AMP chief economist Shane Oliver said the pandemic had caused discretionary spending to be diverted from services like hairdressers and travel to ­physical goods, including building and cars. This global trend had put increased pressure on manufacturers.

“I don’t think (high costs are) a permanent thing (but) now is not the best time to renovate; you’re better off to wait till next year,” Mr Oliver said.

Renovators Stu Balding and Tonya Scheiwe, 52 and 50, believe they hit a reno sweet spot when they decided in 2019 to upgrade their cottage in Hendra, north Brisbane, into a luxury home. While they suffered some Covid impacts, it was nothing akin to the “insane” delays and costs others are dealing with.

“We were quite lucky,” Mr Balding said. “We started work 18 months ago so we’d locked in our builder … only in the last few weeks did we have delays.”

The home is being sold by Place Ascot’s Patrick McKinnon.

Despite lockdowns in Sydney and Melbourne that have disrupted work and supply chains, home construction is expected to rise over the next 12 months as builders work through a full pipeline of work. This is anticipated to slow in 2022.