Home Property Tradies and supplies shortages drive up prices, massively push out wait times...

Tradies and supplies shortages drive up prices, massively push out wait times for building work


Cashed up from saving your pennies with nowhere to travel and planning a home renovation? Good luck with that. Aussies who have been keeping their pennies and are planning to splash that cash on home renovations need to gird their loins for a long wait.

Global supply chain disruptions have caused material shortages. The federal government’s HomeBuilder scheme has stimulated the construction sector to the extent that waits times for almost every trade imaginable have blown out massively – years in some cases.

CommSec chief economist Craig James said it was a classic economic problem of excessive demand, low supplies, and higher prices. “Governments worldwide are trying to lift or sustain their economies, and that means building things or encouraging people to build things,” Mr. James told NCA NewsWire.

“It’s not just residential – governments are trying to get infrastructure projects completed. “With borders closed, the necessary workers can’t be brought in. “And that means budding home builders/renovators must stand in line or pay high prices to get their project done before others.”

In the West Australian building market, there has been the triple whammy of the impacts of the pandemic, the Wooroloo bushfires in February, which destroyed 86 homes, and Cyclone Seroja in April, which devastated the tourist town of Kalbarri and surrounding shires – with the rebuild time estimated at three years.

Master Builders Association of WA chief executive John Gelavis said residential property construction times had roughly doubled. A single-story dwelling took six to eight months to build from slab down to completion in 2019-20. But that was when the industry was “at the bottom of the cycle”, with 14,500 housing starts in WA that year compared to 32,000 at the height of the 2014-15 housing boom.


Mr. Gelavis said the work pipeline in the industry had “dried up” in September, but HomeBuilder had certainly “done its job”. Now, the time has blown out to 12 to 16 months. A double-story home, which had previously taken 10 to 12 months, is now taking 14 to 20 months.

“Every market around the country is bustling,” he told NCA NewsWire. “We’re getting delays in trade availability and some materials supplies. We see double-digit price increases continually from suppliers.

“Some are coming from overseas … there are several factors at play here – but they’re out of the builders’ control. “Consumers need to understand the builders are doing their best, but they can only work with what they’ve got.”

Bunning’s general manager of merchandise Toby Watson confirmed the hardware chain was experiencing the same constraints. “We have seen unprecedented demand for some building materials for several months now due to Australians spending more time at home and the incentives for new home builds and renovations,” Mr. Watson said.

“This is creating a challenge for the entire industry with extreme demand for structural timber. “We’re working with our suppliers and trade customers to forecast demand and plan earlier in the build process, so we have additional time to manage orders as best as possible.”

Mr. Gelavis said securing pine was a big challenge, particularly for roofing, with European supplies being sucked up by the US market. MBA member surveys found 90 percent reported timber delays in June, up from 67 percent in March. Steel was also proving difficult to secure, with 93 percent of members reporting delays last month compared to 84 percent in March.

Even freight was an issue, Mr. Gelavis said. “The length of delays is extending as well. Price increases are occurring quite rapidly at the moment. “In certain circumstances, builders can increase and pass on the prices (to customers), and in certain circumstances, they’re unable to – it depends on the contract.”

He advised homeowners wanting to renovate to pick their tradespeople carefully, given the specialist shortage may tempt many to use a handyperson. “Particularly around things like asbestos – that’s where a qualified trade contractor would understand the laws and rules,” Mr. Gelavis said.

“It’s hectic, and many trade contractors are working very much for builders or building contractors, so definitely do the research and ensure they’re qualified to do the work – that’s important. “Builders are currently paying a premium for some trades and materials.

“The key thing is to be patient … and kind. “They are doing their very best to build the homes in a reasonable time frame. “Slow work is better than no work.” Mr. James suggested if builders/construction companies were motivated, they could apply to the government to access foreign workers, fly them out and pay for quarantine costs. “But it is a case of weighing up the costs to win more projects/quotes,” he said.


* CoreLogic data showed servicing a mortgage was now cheaper than paying rent on 36.2 percent of Australian properties – up from 33.9 percent before Covid-19 struck in February last year

* Australian Bureau of Statistics data showed the total number of dwelling starts around the nation rose by 0.2 percent to a two-and-a-half-year high of 51,662 units in the March quarter

* While apartment starts fell 11.3 percent during the period, the house starts rose by 5.9 percent to 36,395 units. According to CommSec analysis, that’s the highest level since September 1969, up 40.6 percent from a year ago.

* The most significant increase in detached commencements was in WA (up by 136 percent compared to the same quarter last year), followed by South Australia (up 61.7 percent), Northern Territory (up 59.6 percent), Tasmania (up 50.7 percent), ACT (up 50 percent), NSW (up 37.5 percent), Queensland (up 28.8 percent) and Victoria (up 14.6 percent).


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