A retired couple lost their ,000 deposit and were left with an unfinished dream home following the collapse of a construction company.
Karen and Colin Scarlett paid Adelaide-based builder Qattro a $70,000 deposit three years ago to build their permanent home in Underdale, 5km from the CBD.
Now the couple are among another 200 people left behind after the construction company went into voluntary administration on Tuesday.
The house was initially expected to be completed in less than 12 months, but the completion date was pushed back due to the pandemic.
The business then collapsed, leaving their house three-quarters complete.
Karen and Colin Scarlett (pictured) have a house three-quarters complete and are unsure how it will be completed after their builder went into voluntary administration on Tuesday.
Their home in Underdale (pictured) near Adelaide’s CBD was due to be completed two years ago, but faced countless delays due to the pandemic.
All new home builds in South Australia are covered by indemnity insurance, but it remains unclear whether their claim will cover the remaining cost of construction.
Mr Scarlett retired before the couple committed to building the house and did not save enough money to absorb the expensive disaster it became.
“When you’re on a fixed income (like) I’m retired now, it’s not easy to find that money,” he said. 7News.
“At the moment, we really don’t know where we might end up.”
The couple was told they had three choices: stick with the partially completed house, cut their losses and buy another one, or continue renting.
Buying another house could cost $150,000 more than the first, which is only three-quarters complete.
Mr Scarlett doesn’t know where they could find the money to afford another house while they have to pay rent in the meantime.
From Qattro entered into voluntary administration, all their customers are eligible to begin the process of recovering their losses through their damage insurance for the building.
But even if insurance covered the cost of the house, the Scarletts would still have to overcome commercial sourcing problems.
The developer working with the couple in Underdale, Mark Johnson, said he chose Qattro for its good history of similar projects.
Mr Johnson is also set to pick up the pieces this week, revealing it was his last build before retiring.
He said his company was forced to pay high interest rates on unfinished homes while everyone else figured out what to do.
Qattro is the latest in a long line of construction companies to collapse this year, owing $4.5 million to unsecured creditors and leaving behind 16 unfinished projects.
One of the unfinished developments was Fletcher’s Slip at New Port and Dock One at Port Adelaide, which promised harborside homes in a vibrant community.
Qattro owed $4.5 million to unsecured creditors and was working on 16 now-unfinished developments.
One of the company’s major developments was Fletcher’s Slip at New Port and Dock One at Port Adelaide, which promised harborside homes in a vibrant community.
This is the latest collapse in the trend of builders being unable to overcome costly losses suffered by the industry during the pandemic.
Karim Hrynkiw, a subcontractor working on Qattro’s Dock One development, said they suspected something was wrong when invoices started being paid late.
Mr. Hrynkiw now says he has between $60,000 and $80,000 left out of his pocket.
South Australian Prime Minister Peter Malinauskas sounded confident when addressing the issues, insisting the industry’s problems were easing.
The premier said his state had performed better than others when it came to areas where builders had been hit hardest after the pandemic.
He also told Qattro’s clients that his government hoped to establish a hotline they could call while they figured out their next steps.
Nationally, 1,709 construction companies have been placed into administration in the last 12 months.