A major Australian home building company has entered receivership in one state capital, leaving people thousands of dollars out of pocket.
Hotondo Homes in Hobart has entered receivership and left dozens of people in limbo with unfinished homes following speculation a closure was imminent.
Tasmanian Constructions, which owns the Hotondo Homes franchise in Hobart, last Wednesday informed the Australian Securities and Investments Commission (ASIC) that it was closing down.
The company had decided at a general meeting on January 4 to wind up operations and appoint Jarvis Lee Archer of Revive Financial as liquidator, according to the ASIC notice.
NCA NewsWire has contacted Revive Financial, Hotondo Homes and Tasmanian Constructions for comment.
Dozens of construction projects have reportedly been left in limbo and clients left out of pocket as a result of the liquidation
The Mercury reported a customer of the company received an email on Wednesday night stating that Hotondo Homes was placed into liquidation.
“We understand that the company was in the process of constructing a residential dwelling for you,” the email read.
“We are currently working with the company’s staff and contractors to understand the current status of each contract and the options available to you.”
It’s believed as many as 80 contractors and 40 customers are likely to take a financial hit.
Master Builders Tasmania executive director Matthew Pollock told the ABC that the state’s construction industry had been under strain.
“The last 12 months has been characterised by a period of peak demand, driven by HomeBuilder grants, and both state and federal governments (are) putting a large responsibility on the building industry to lead the economic recovery,” he said.
“It’s coincided with a very challenging period for businesses with supply chain disruptions, material price increases and trade shortages.”
Hotondo Homes’ closure follows a period of disruption in the Tasmanian building industry, with widespread reports of residents across the state struggling to get their homes finished or being left with defects.
The state was the only jurisdiction in Australia without home warranty insurance, which covers customers if their builder dies, disappears or becomes insolvent, after it was removed in 2008.
The Tasmanian government reintroduced home warranty insurance in late December but voted down calls from the sate opposition for an inquiry into the building industry.
Labor’s Building and Construction spokeswoman Jen Butler in October called for the probe into “shonky” builders, which Consumer Affairs Minister Elise Archer dismissed as “completely unnecessary”.
“The Tasmanian Liberal government has made significant reform to our building regulatory framework and supports streamlining industry regulations to ensure strong protections for consumers are in place,” she said at the time.
The government in November merged several existing tribunals to launch the Tasmanian Civil and Administrative Tribunal, which will be able to handle building disputes.
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