The State Government has called for a review into increased building costs and their impact on housing affordability following growing price gouging concerns.
Housing and Urban Development Minister Nick Champion has written to ask the Australian Competition and Consumer Commission (ACCC) to conduct the review and take a more active role in monitoring construction price materials.
Master Builders SA also raised fears the rising price of building products will have a negative industry impact.
Minister Champion said according to Australian Bureau of Statistics figures, building products rose by 3.8% during the December quarter and were 12% higher than last year.
He said the increase had seen severe price hikes to building materials over the year to December 2021 including reinforcing steel costs (an increase of 43.1%), structural timber prices (39.7%), steel beams and sections (24.8%) and plastic pipes and fittings (24.7%)
“The rapid increase in pricing has seen home builders locked into fixed price contracts which is inconsistent with the current changing market with some even going into receivership,” Minister Champion said.
“Subsequently, disturbing allegations of predatory pricing and price gouging with suppliers and wholesalers taking advantage of short supply and increased demand have surfaced.
“Providing certainty to South Australia’s building and construction industry is vital in ensuring their customers are not caught having to pay more or wait for longer for their builds.
“I would welcome an intervention on behalf of the ACCC to investigate allegations of price gouging and the cost of materials in the sector.