Construct Homes Pty Ltd goes into receivership as customers wait in limbo with half-built homes

Another building company has collapsed amid an industry-wide crisis, with customers now searching for answers as to what will happen to their half-finished family homes.

Melbourne-based Construct Homes Pty Ltd was placed into receivership on July 11, with the firm’s website offline along with its phone lines.

Sam Kaso from insolvency firm Cor Cordis has been appointed as receiver of the defunct company, news.com reported.

It is believed Mr Kaso has been placed into the role to recoup funds for an unnamed creditor that he represents.

The company’s receivership makes it the latest of almost 2,000 construction companies that have gone bust since July 2022.

Another construction company, Melbourne-based Construct Homes (pictured), has collapsed amid an industry crisis that has left many Australians left with unfinished homes

The company’s website, which was briefly shut down, stated the company had an ‘envied reputation for innovation, style and affordability’.

‘We value tremendously the trust placed in us by our homeowners and we are eager to work with you on building your personal residence.’

One disgruntled client whose house remains unfinished, a father-of-one named Jason, said: ‘It’s a lot of disappointment’.

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‘It was going to be our family home for us, we did a lot of research into finding the right builder and making the right decisions,’ he told News.

‘We thought we were in a position where this wasn’t going to happen to us.’

Customers of Construct Homes  are not entitled to insurance payouts as of yet as the company has been placed in receivership and not liquidation or administration.

Numerous clients of Construct Homes, including a father-of-one, have been left without a finished home after not being able to get in contact with the company for weeks 

Between July 2022 and April 2023, 1,709 builders went into administration – which insiders say can be traced to the HomeBuilder grant introduced by the previous government in June 2020.

More than 130,000 customers signed on for the program, with builders usually agreeing to take on work under a fixed-price contract.

Phil Dwyer, president of the Builders Collective of Australia said the stimulus worked so well that it put too much pressure on an already ‘heated industry’ by overloading builders with work they couldn’t complete.  

In 2022, supply chain issues erupted spurred on by Russia’s invasion of Ukraine making global prices for building materials like steel and wood spike.

Labour shortages also appeared, causing tradies to be more in demand resulting in them being paid more and being slower to complete work.

Along with a run of wild weather in 2022 and rising inflation, builders found themselves with a huge backlog of work that was costing them much more and taking longer than what they had planned.