‘Endless delays and broken promises’: Aussies struggle after sudden collapse of major builder
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The Australian dream of owning a home has turned into a nightmare for several families following the unexpected collapse of a major building company.
The recent downfall of Varaich Homes, also known as Harcon Property Group, has left many customers in despair, facing financial ruin and the distressing reality of unfinished homes.
The collapse of Grandeur Homes in Victoria, which has affected up to 110 projects, is just one example of the instability currently plaguing the Australian construction industry.
The situation has become all too familiar, with Varaich Homes being the latest in a string of construction companies to go under, leaving behind a trail of half-built dreams and financial chaos.
Customers like Harpreet Singh have shared harrowing tales of their properties being vandalised, with disturbing finds such as used condoms and urine in their unfinished homes.
The emotional and financial toll on these families is immense, with many like Singh, who signed up for a $457,000 build, now facing the prospect of taking out personal loans to complete their homes.
‘The fence surrounding it has been taken off, and people were going in and having beers, using the toilet, I found a used condom on the master bedroom floor, and there are a few other damages,’ Singh said.
The construction industry has been hit hard by a perfect storm of rising costs, with the flooding in New South Wales and Queensland and the Russia/Ukraine conflict pushing up the prices of materials and labour.
Builders like Varaich Homes have passed these costs onto their clients, with some, like Singh, being asked for an additional $45,000 to continue their projects—money that many simply do not have.
The impact is widespread, with customers like Vijay Bhusal and Mallikharjuna Allanki also sharing their stories of frustration and financial burden.
Bhusal, who was building his first home, has lost over $100,000 in holding interest and fees, while Allanki has faced significant delays and breaches of contract terms.
‘We signed contracts in August 2021, filled with excitement and anticipation. However, instead of joy, we have been met with endless delays…and broken promises,’ Bhusal said.
‘The company repeatedly missed deadlines, starting construction six months later than agreed upon and failing to complete our homes even after the promised time frame. Our houses remain unfinished, a constant reminder of our shattered dreams.’
The situation is not only a financial disaster but also a mental health crisis, with customers like Tony Varghese seeking professional help to cope with the stress.
‘It’s shocking to see that this has become a common occurrence in the building industry over the past few years. The government cannot remain a bystander in this situation, allowing people’s hard-earned money to be (taken) and leaving them trapped in financial despair through no fault of their own,’ he said.
The government's role in protecting consumers in these situations is being called into question, as people like Varghese find themselves potentially locked into a lifetime of mortgage payments without a finished home.
Malcolm Howell from Jirsch Sutherland has been appointed administrator of Varaich Homes.
‘The team will be writing to creditors shortly and will advise the homeowners on options available,’ she said.
‘As the insurance has now been cancelled by the VMIA (Victorian Managed Insurance Authority), the company is unable to continue with the construction of the homes. One of the options available is to sell the contracts as a whole to an alternative builder.’
Have you or someone you know has been affected by the collapse of a building company? Share your story with us in the comments below.
The recent downfall of Varaich Homes, also known as Harcon Property Group, has left many customers in despair, facing financial ruin and the distressing reality of unfinished homes.
The collapse of Grandeur Homes in Victoria, which has affected up to 110 projects, is just one example of the instability currently plaguing the Australian construction industry.
The situation has become all too familiar, with Varaich Homes being the latest in a string of construction companies to go under, leaving behind a trail of half-built dreams and financial chaos.
Multiple Aussies were in limbo as a major building company collapsed. Credit: Shutterstock
Customers like Harpreet Singh have shared harrowing tales of their properties being vandalised, with disturbing finds such as used condoms and urine in their unfinished homes.
The emotional and financial toll on these families is immense, with many like Singh, who signed up for a $457,000 build, now facing the prospect of taking out personal loans to complete their homes.
‘The fence surrounding it has been taken off, and people were going in and having beers, using the toilet, I found a used condom on the master bedroom floor, and there are a few other damages,’ Singh said.
The construction industry has been hit hard by a perfect storm of rising costs, with the flooding in New South Wales and Queensland and the Russia/Ukraine conflict pushing up the prices of materials and labour.
Builders like Varaich Homes have passed these costs onto their clients, with some, like Singh, being asked for an additional $45,000 to continue their projects—money that many simply do not have.
The impact is widespread, with customers like Vijay Bhusal and Mallikharjuna Allanki also sharing their stories of frustration and financial burden.
Bhusal, who was building his first home, has lost over $100,000 in holding interest and fees, while Allanki has faced significant delays and breaches of contract terms.
‘We signed contracts in August 2021, filled with excitement and anticipation. However, instead of joy, we have been met with endless delays…and broken promises,’ Bhusal said.
‘The company repeatedly missed deadlines, starting construction six months later than agreed upon and failing to complete our homes even after the promised time frame. Our houses remain unfinished, a constant reminder of our shattered dreams.’
The situation is not only a financial disaster but also a mental health crisis, with customers like Tony Varghese seeking professional help to cope with the stress.
‘It’s shocking to see that this has become a common occurrence in the building industry over the past few years. The government cannot remain a bystander in this situation, allowing people’s hard-earned money to be (taken) and leaving them trapped in financial despair through no fault of their own,’ he said.
The government's role in protecting consumers in these situations is being called into question, as people like Varghese find themselves potentially locked into a lifetime of mortgage payments without a finished home.
Malcolm Howell from Jirsch Sutherland has been appointed administrator of Varaich Homes.
‘The team will be writing to creditors shortly and will advise the homeowners on options available,’ she said.
‘As the insurance has now been cancelled by the VMIA (Victorian Managed Insurance Authority), the company is unable to continue with the construction of the homes. One of the options available is to sell the contracts as a whole to an alternative builder.’
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