Best wishes to our members and supporters for a peaceful festive season and a prosperous New Year.
The HBAG Team
When reputable, long-term
home builders go broke,
everyone suffers
When reputable, long-term home builders go broke, everyone suffers
Breaking News
4 December 2024
Response from prominent WA builder identifying difficulties wtih indemnity insurance
3 December 2024
Response from builder member regarding representation to QBE
2 December 2024
Representation to QBE regarding indemnity insurance
Lend your support to the Home Builders Action Group today
The Home Builders Action Group was formed in July 2023 to represent small and medium Western Australian builders to decision-makers including government. The self-funded group represents around a hundred small to medium sized independent home builders who are committed to finding solutions to the current home building crisis before it’s too late.
And to make sure it never happens again.
Government holds all the cards
A house isn’t just a place for people to eat and sleep in, owning a home is the cornerstone of the Australian Dream.
The home building industry is a highly regulated sector because Australians want their government to ensure it operates fairly, efficiently and sustainably.
Builders are happy to operate within the regulations. But when those regulations are no longer fit for purpose and fail to take into account dramatic cost increases and labour shortages, small to medium sized builders go broke.
It’s no wonder that hundreds of small to medium home builders are facing the very real prospect of having to close their doors, leaving thousands of West Australians in an unimaginable and entirely avoidable financial and social position.
More than just a house
According to an Australian Parliamentary senate committee submission into housing affordability, “apart from meeting the basic need for shelter, housing provides a foundation for family and social stability, and contributes to improved health and educational outcomes and a productive workforce” and “given its importance in promoting and maintaining a functional, stable and just society, housing should not be considered just another commodity.”
According to the Australian Bureau of Statistics, in 2020 the family home represented 40% of the average family’s assets.
So when a family is without a home or the means to secure one, it’s not just an immediate inconvenience, it’s a long term social and economic disaster.
The current situation
The prospect
The rash of building bankruptcies that have featured in the news recently is nothing to the tidal wave we will soon see if swift, sensible action is not taken by government.
The shaky, fly-by-night builders have already collapsed and now many long-term reputable builders are facing impossible financial pressures with no relief in sight.
And for every builder in trouble, there are 50 families affected, many in impossible financial situations, waiting for their homes to be finished.
The causes
Costs have increased by more than 50% in two years and builders are prevented by law from increasing prices by more than 5% or their contracts could be cancelled. This means that almost every home builder in the state is giving their all to complete homes that they will lose money building.
Then, well-intentioned but poorly thought out government grants have put more pressure on an already overheated industry, pushing costs up and stretching completion times out even further. Combined with a rental market with record low stock and you have the makings of a perfect storm.
The effects
When a builder goes broke, everybody loses. From the hundreds of home buyers left facing massive extra costs to finish their partly built homes, to the sub-contractors, suppliers and staff who are left unpaid.
Multiply this by hundreds of builders and it’s not difficult to see how the situation could spiral out of control past the point of no return.
HBAG is proposing a 5 point plan
1. Review and amend the Home Building Contracts Act which is not fit for purpose in the present environment (as discussed with DMIRS – Building and Energy)
2. Reinstate the SME Recovery Loan Scheme as quickly as possible; (this can be re-activated by Treasury as a matter of urgency). 4 Jan 2024 “No Interest” Loan Scheme announced by Goverment
3. Direct further Government stimulus through the builders and the trades to keep the industry afloat; (This will be managed by Treasury and other Authorities as required)
4. Create an intelligent industry assistance package to address the following: (This will be managed by Treasury)
5. Urgently address Trade Training to produce skilled workers quicker.
HBAG seeks your support in convincing Government to support its realistic and affordable package that will assist not just the small to medium-sized home builder but the whole community.
What we’ve done so far
Formed the Home Builders Action Group
Adopted a mission statement for the group
Formulated a 5 Point Plan to address the areas of concern
Signed up our first hundred supporters
Pursued the mission statement with high level ministerial meetings and meetings with members of parliament, unions, industry bodies, members of the home building industry
It’s really politics!
But it is short-sighted not to understand that we live in a political world and that – if we fail to take that into account – HBAG will be much less effective.
There are two fundamental first considerations:
- The Cook Government has a massive parliamentary majority. There are 59 seats in the Legislative Assembly (where the Government sits) and the Labor Party has 53 of them. The Liberal Party has just two seats and the National have four. Straightaway that tells you the massive Labor majority means it is not too worried about losing government and that makes it harder to get it to listen; and
- Politics can be explained by asking someone what car they drive and when was the last time they went to the dealer and asked to be put into something worse? It doesn’t happen. So, for long as the Liberal Party fails to get itself into shape it will struggle to get support.
HBAG believes that, at the next election, it’s likely the Government will lose seats but retain Government. How many seats it loses will depend on its performance and positive changes made by the Opposition and the quality of their candidates.
Tailoring our approach to reality means we have to make representations on several levels.
- First, the whole of government approach taking into account the views above;
- Second, representations to individual members. Even if the Government is safe, each member has to win his or her own seat and HBAG intends to divide its membership into areas and then to have those groups of HBAG members meet with their local members; and
- Third, highlight the performance of Ministers each of whom will be wanting to retain their ministerial position after the election. HBAG will be active in supporting Ministers it believes are responsive and intelligently helpful.
As an example: When HBAG made representations to the Minister for Housing, The Hon. John Carey MLA, Minister Carey simply handballed our approach the Minister for Commerce, the Hon. Sue Ellery MLC who was available, open, and intelligently responsive. In comparison and by any measure, Minister Carey’s lack of interest was disappointing.
HBAG will undertake advertising, social media and other campaigns to inform the electorate about the experiences it has with Ministers and Members and our view of their performance.
Sign up to support the Home Builders Action Group
If you’re a small to medium-sized builder located in Western Australia, make your voice heard by signing up as a supporter of the Home Builders Action Group today.