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Event: Interview with Karl Stefanovic, Today Show
Date: 6 February 2024, 7.20am AEDT
Speakers: Denita Wawn, CEO Master Builders Australia
Topics: inflation, labour shortages, building materials
E&OE
Karl Stefanovic, host Today Show: Queensland homeowners looking to build, repair or renovate are being warned of a new wave of price hikes. Let’s bring in CEO of Master Builders Australia Denita Warn live in Canberra, and Brisbane resident Michelle Goodchild, who is currently building a pagola in her backyard. Good morning, ladies. Nice to see you this morning. Michelle, you’re first up but you got quite the shock when you started this DIY project. Tell everyone at home what happened.
Michelle Goodchild, Queensland resident: Well, we just started. We’ve been building on and off for the last five years. My husband’s actually even in the construction industry, and we just started an outdoor pergola over our pizza oven, and we perceived the costs to be $5,000 in building it. And, you know, it’s looking like it’s gonna come in at double at $10,000.
Karl: Right and how did they justify that?
Michelle: Yeah. Sorry. So look, what’s happened is I’ve even sourced the wood locally, going to sawmills and second-hand; we thought the wood would come in at $3,500. It’s looking like it’s gonna come in at $5,500 – $6,000. The concrete truck was there a couple of weekends ago. We estimated that at, you know, $4,000-$5,000. The bill that came in for that was over $10,000. And you know I’m not the only one. A girlfriend did a laundry up the road, and she just did a reno on that and it came in at $15,000.
Karl: Yeah, look, there’s no doubt about it. It’s getting horrifically expensive to do all that. Denita, can you explain some of those price hikes and for how long we might be seeing those for?
Denita Wawn, chief executive Master Builders Australia: Yes, and unfortunately, this is not contained to Queensland. This is a national problem. Prices in materials are still at a record high. They are around about 35 per cent over 2019 figures. We still saw another increase in building products in the December quarter and as a consequence, we’re now seeing the price of building a home or renovating a home at around about nearly 40 per cent more than 2019. And it also takes longer. And there are two reasons, Karl. One is because of those price hikes of building materials. But also we’ve got a huge shortage of labour and that means that prices for existing labour are higher. And also, unfortunately, it’s taking longer as well.
Karl: Alright, so what is the outlook? When is it going to get cheaper?
Denita: Well, I think there’s a number of things. One is that we need inflation to go down, and we need more competition in the marketplace in terms of building products. We also need to ensure that we get more people into the industry. We’re estimating that to build the one million-odd homes that we’ve signed up with the government, in the Housing Accord, that we need well over 500,000 new entrants over the next five years. That’s a huge number of people. And so we’re trying to encourage as many people to get into the industry as possible, make sure they don’t leave the industry. And, of course, we’ve got immigration as well to rely upon.
Karl: All right, looks like a long road ahead in terms of getting those prices down. We appreciate it. Thanks so much for being on the show.
Media contact:
Dee Zegarac
National Director, Media & Public Affairs
0400 493 071
dee.zegarac@masterbuilders.com.au