Help for Tasmanians hit hard by building company collapse

Tasmanians affected by home building companies recently going into administration will be able to get their deposits back thanks to an insurance scheme being reintroduced by the government.

Tasmanians affected by home building companies recently going into administration will be able to get their deposits back, with assistance now available as the state government reintroduces home warranty insurance.

Consumers who have paid a deposit will be able to get up to five per cent of the contract value returned if building works haven’t started.

It comes after Hotondo Homes and Inside Out Construction went into liquidation, leaving many with unfinished homes.

“There are statutory protections already in place to protect deposits not going above the level of five per cent,” consumer affairs Minister Elise Archer said.

“We don’t want consumers to be disadvantaged.”

A second measure helps those who are affected by a circumstance where the builder has died, disappeared or become insolvent.

Minister of Corrections Elise Archer MP at the Southern Remand Centre construction site. Picture Chris Kidd

“The other situation where people have signed contracts and there’s unfinished building works, we will under the financial assistance package, compensate them for up to 20 per cent of the contract price with a maximum value of $200,000,” she said.

“That of course is for goods and services that have been paid for and not supplied.”

Carlo Loubser and his wife are one couple who will now be able to get their deposit back after being left devastated by the collapse of Hotondo Homes.

“We came to Australia quite recently and we found there was a bit of a smash in the building industry,” Mr Loubser said.

“We considered ourselves lucky that we could get this block and build a house form our family.

“We felt very disappointed and unsure at the beginning of the year when we learned about Hotondo becoming insolvent.”

Half completed Hotondo Home in Kingston after Hotondo goes into receivership. Photo: Linda Higginson

Now the couple may end up having to pay more.

We didn’t know what was lying ahead

“The spanner in the works was, what will the build going to cost now?” Mr Loubser said.

“We started touching base with other builders and it seems as if the build will cost over a hundred thousand dollars more.”

Mr Loubser estimated plans could also be pushed out by a year, which means more time and money spent renting.

Master Builders Association Tasmania CEO Matthew Pollock said the pandemic had taken a toll on the building and construction sector.

“In the current market we’ve seen substantial changes materials and labour prices, that means requoting jobs in the current market is different to where we were 12 months ago,” he said.

Mr Pollock believed some pressures could soon ease.

“The last 12 months has exposed some builders but we are getting to the other side of some of those challenges,” Mr Pollock said.

“Supply chains are beginning to catch up, producers are beginning to build their industries and we’d expect to see some relief in that respect over the next six months.”