WA’s construction industry has experienced significant labour and material price hikes over the past few years. Photo: Google Earth.
The West Australian Government has established a fund and an interest-free loan facility to support builders to complete homes that have remained unfinished for two or more years.
The Builders’ Support Facility will provide a maximum of $300,000 to each eligible builder – up to $60,000 per property – with payments made in instalments to stimulate more completions.
The government says the scheme is targeted and measured to help builders complete outstanding projects, as well as prevent further insolvencies and more homes being left incomplete. It comes as a direct response to a recent roundtable held between the Government, the Housing Industry Association (HIA) WA, and the housing and construction industry.
Builders will be required to meet eligibility criteria, including being a solvent WA-based residential builder that has been in continuous operation in WA for more than four years and has at least one uncompleted home in WA that began construction before January 2022.
Builders are required to complete a registration of interest at www.smallbusiness.wa.gov.au/builders, which is open until 31 January, and loans will be offered on a first-come, first-served basis.
WA Treasurer Rita Saffioti said the state’s construction industry had experienced significant labour and material price hikes over the past few years.
“This has delayed some residential builders from completing homes as the cost has increased significantly,” she said. “We have also seen many families building new homes left stranded with incomplete projects and no timeline for delivery.
“The innovative loan facility will enable builders who have been unable to complete homes under construction for two or more years, due to cashflow constraints, to complete these projects.
“Providing secure housing to Western Australians, boosting housing supply and supporting a sustainable building industry are among the top priorities of the Cook Government.”
Commerce Minister Sue Ellery said the building of a new home was a major life event and could be stressful at the best of times.
“The government continues to engage closely with the residential construction industry to address the challenges they are being faced with,” she said.
“We are doing everything we can to support builders to complete unfinished properties, get Western Australians into their new homes, and boost overall housing supply.”
Housing Minister John Carey added: “The government is acutely aware of the current housing market across the country and its impacts on many Western Australians – including those who have experienced construction delays in the face of a tight construction market.
“This $10m loan facility will support eligible residential builders to complete unfinished houses to get more Western Australians into their new homes, and further bolster WA’s housing stock.
“We’ve funded a range of new initiatives and reforms to support the construction industry – as well as homeowners and renters – and this initiative further boosts these efforts.
“Our government is investing a record $2.6 billion in housing and homelessness measures, and we’ve added more than 1800 social homes, with more than 1000 social homes currently under contract or construction, throughout Western Australia.”
The HIA said the challenges the residential building industry had faced over the past three years had been well documented.
HIA WA executive director Michael McGowan said: “Builders all around Australia have suffered as a result of significant cost escalation, material shortages, and the consistent supply of skilled labour.
“Skilled labour and cash flow have been builders’ biggest challenges over the last 12 months.
“Implementing the Builders’ Support Facility takes steps to support builders who may be suffering cash-flow issues to complete homes for their customers.
“As the residential building industry normalises over the next 12 months, the targeted Builders’ Support Facility is a measured way to support those needing short-term assistance to complete homes that have been under construction for more than two years, by providing a short-term cash injection targeted at getting homes finished without impacting the wider industry.
“When a builder enters administration, the industry and the state suffer. The builder and their family lose everything, trades and suppliers suffer losses, with consumers having to wait to restart the home-building process.
“The Builders’ Support Facility will hopefully minimise the number of people that have to go through this process.”
