Materials Shortages Force Tasmanian Development Shutdowns


The shortage in construction materials has hit an all-time low in Tasmania with builders saying projects are being abandoned.

As is the case across Australia, building supplies are in short supply on the island state due to the pandemic.

Factors at the root of the shortages include rising shipping costs due to a shortage of empty containers, increasing labour costs and record low interest rates that have prompted unprecedented demand for new housing stock across the country.

The situation hasn’t been helped by the housing boom fuelled by incentives from the federal government, with some builders telling developers that projects can’t start on time while other projects are grinding to a halt half-built, particularly in the residential sector.

But the logistics of getting products across Bass Strait to Tasmania is adding to the woes of local builders.

Some projects, particularly new homes and renovations, are not going ahead due to rising costs, Lifetime Homes Tasmania said.

The supply shortage includes timber, cement sheet, glass, plasterboard and steel mesh reinforcement.

The shortage comes amid a surge in developments on the Apple Isle. There were 63 non-residential jobs valued at $32.2 million approved in Tasmania in April 2021, according to the latest construction snapshot by the Master Builders of Tasmania.

Housing prices in the year to May 2021 have risen 16.5 per cent in Hobart, and 19.1 per cent in regional Tasmania, the report said.

Local media has been reporting on distraught home owners detailed how builders have been taking shortcuts due to the materials shortage, with devastating consequences, including unsafe work.

Despite the shortages, the projects keep coming. Just last month, plans for a $100-million apartment, retail and accommodation development at Hobart’s Macquarie Point were unveiled.

The Tasmanian government selected Melbourne developer Milieu as the preferred development of The Escarpment, to be built below the Hobart Cenotaph.

The construction supply shortage is expected to ease during 2022 as supply of construction materials from overseas returns.

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