Prominent Perth builder Inspired Homes collapses
Another major residential home builder has folded, with Perth's Inspired Homes leaving dozens of disgruntled clients turning to insurance to have their home completed.
The building crisis that has seen hundreds of major builders go bust around the country has claimed another high profile construction company, with Inspired Property Group lapsing into administration in Perth.
At least 80 customers have unfinished homes dating back to 2020.
Customers who spoke to media said they were “elated” that the company had formally collapsed so that up to $200,000 in indemnity insurance could be put towards finishing homes that have been idle building sites for years.
McGrathNicol were appointed as the administrators on 1 April. They have pledged to work with staff, suppliers and customers to come up with “the best outcome for all parties”.
In October 2024, the WA State Government picked up the $40 million bill when it struck a deal with failed builder Nichliving to give up its building registration for the next decade in exchange for having its insurance liability waived.
The government was in caretaker mode in early March when it said it could not intervene in the same way with Inspired Homes until after the state election. Western Australian Premier Roger Cook has since met impacted customers and vowed that finishing the outstanding builds was a top priority.
In a statement that mirrored those of so many collapsed construction companies over the past few years, Vas Spaseski. Director, Inspired Property Group, said the decision to enter administration was made with “deep sadness”.
“As a family-owned business, our mission has always been to create homes of exceptional craftsmanship, and we are incredibly proud of the trust our clients have placed in us over the years,” he said.
“Rising costs from subbies (subcontractors) and suppliers and the challenges facing the construction industry with the shortages of trades and materials have made it increasingly difficult to operate sustainably in the fixed priced contract structure.”
More construction troubles ahead
While the triggering of the indemnity insurance is a positive outcome for Inspired Homes’ clients, they will still confront the same issues that led to their builder’s demise, namely finding builders with the capacity to take on their jobs in the face of labour shortages and other issues.
Signs of an immediate industry turnaround are few and far between.
The total number of dwellings approved fell 0.3 per cent to 16,606 in February, according to seasonally adjusted data released Wednesday (2 April) by the Australian Bureau of Statistics (ABS).
Maree Kilroy, Lead Economist for Oxford Economics Australia, had some cautionary words for those in the west relying on builders.
“National private house approvals rose 1 per cent to 9,203.
“Off a soft January, New South Wales posted the biggest gain (+5.1 per cent).
“At the other end of the spectrum, Western Australia normalised 8.5 per cent.
“The slow down on the west coast reflects capacity constraints that are now impacting the rollover of builders onto new projects.”
She added that the looming Federal election is not expected to impact the near-term outlook for approvals.
