More companies have joined the list of collapsed builders in Australia. 

Residence Building Group, a South Australian builder, has recently entered voluntary administration, becoming the latest casualty in a series of construction company failures in the region this year. 

The company cited fixed-price contracts as a contributing factor to its accumulated debts exceeding $1 million.

The company has appointed Agile as its voluntary administrator. David Menner, the managing director, says the firm faced immense difficulties faced in the wake of COVID-19, inflation, and the strain caused by the HomeBuilder program on the industry. 

These factors, combined with a fixed-price contractual environment, created pressure for the sector, particularly affecting smaller boutique businesses like Residence Building Group.

Agile, the appointed administrator, reports that seven residential clients have been affected, with six in Adelaide and its suburbs and one in the hills. 

Construction work on all projects has been halted, as Agile plans to formulate a plan over the next month.

The company owes debts of up to $2 million, primarily to investors and the Australian Taxation Office. As of now, four staff members, including the managing director, have not had their positions terminated.

The collapse of Residence Building Group follows the recent financial woes of other builders, including Qattro and Felmeri Homes, highlighting the industry's struggles with rising costs, cashflow problems, and labour shortages.

Meanwhile, Chatham Homes, operating as River Dale Building Group, has entered voluntary liquidation in Victoria, adding to the list of distressed builders in the region. 

The company's financial woes are attributed to challenging market conditions and economic pressures.

AS Advisory has been appointed as the liquidator for Chatham Homes, which owed $2 million to over 200 unsecured creditors, primarily tradespeople. 

The business had approximately 50 ongoing projects in Melbourne, Ballarat, and Torquay, which it is unable to complete due to a lack of funds.

Andrew Schwartz, the liquidator, says that discussions with alternative builders are ongoing to find solutions for affected home builders. 

Megan Peacock, Executive Director of Policy and Media at the Master Builders Association of Victoria, has emphasised the potential for additional costs when builders take on incomplete projects. 

While goodwill exists within the industry to complete such work, customers may face higher expenses than initially quoted or contracted.

Peacock also advised caution when taking on unfinished jobs, particularly those in the early stages of construction, as builders are liable for the quality and compliance of the work for up to 10 years after completion.