This article is from the Australian Property Journal archive
AMIDST ongoing turbulence in the construction industry, Metricon is terminating fixed-price customer contracts and has stopped paying commission fees to some agents.
According to reporting from ABC, Australia’s largest residential home builder has terminated dozens of fixed-price contracts and told its customers to sign on to new more expensive contracts or else the construction of their home will be cancelled.
Metricon has also reportedly ceased paying some buyers agents’ commission fees, with the Melbourne-based arm of the company telling agents all payments were “on hold for the time being”, without providing any explanation.
Just last month, Metricon was named among the companies deemed financially capable of delivering the nearly 1,800 unfinished homes left in limbo by the March collapse of major builder Porter Davis.
The Victorian government offered support for those impacted by Porter Davis’ collapse and left without insurance through no fault of their own in the form of a $15 million bailout package.
Metricon faced a challenging 2022, with the passing of its founder and CEO Mario Biasin, and dealing with industry and media speculation about its future before it received a $30 million capital injection from its owners and support from the Commonwealth Bank.
The construction industry has been plagued with insolvencies over the last year leaving many buyers out of pocket, with the building arm of Toplace Group falling into administration most recently.
While in March, the Canberra-based national builder company PBS Building collapsed, leaving 180 staff without a job and 80 commercial and residential projects unfinished.
Construction costs have reached a new high after recording the greatest annual increase on record.
With rising material costs, supply chain issues and labour shortages across the industry, 2022 ended with the collapse of Elderton Homes.
Other major casualties have included such as ProBuild, multibillion-dollar developer Caydon Property Group, and Queensland builder Condev, leaving billions of projects across the country in doubt.
With high-rise and luxury apartments developer EQ Constructions among the first builders to collapse this year, owing at least $40 million to $50 million.
