South Australia must strengthen protections for homebuyers trapped by failed developers

The South Australian government has announced plans to strengthen protections for homebuyers abandoned by failed developers.

It follows the collapse of Felmeri Homes almost 18 months ago, which left countless homes in O’Halloran Hill unfinished.

To improve safeguards for buyers, the government is soliciting public feedback on proposed regulations for property developers.

These measures include mandatory licensing for building inspectors, transferring construction disputes to a court to avoid lengthy and costly lawsuits, and regulating sunset clauses that allow builders to terminate contracts.

“Builders have to be licensed, trades have to be licensed, we think the people who inspect their work should also be licensed,” Master Builders SA CEO Will Frogley said.

However, concerns have been raised that even stricter laws may not fully protect homebuyers.

When Felmari collapsed, infrastructure such as that at the O’Halloran Hill development was not completed, which the state government says was the fault of the local council. Although the mayor doesn’t agree.

“It’s not really a question of Marion Council doing the wrong thing with the planning laws,” Mayor Kris Hanna said.

“Our planning team did what they were supposed to do, following the rules established by the state government.”

The state government is now working to recoup the $4.2 million in taxpayer money spent on this infrastructure.