Two staff members who were in sales had resigned, the price of land had risen astronomically, building material costs were escalating, interest rates were still high, inflation remained elevated and people were having trouble getting access to finance, he said.
Sections which were just under $200,000 a few years ago were now going for $550,000 and above in Pōkeno alone, he said.
“At the moment, I’ve ceased trading [that company] and what I will do, I don’t know. I’ll have meetings in the next few weeks to determine that. The company is unable to pay its bills,” he said.
The Franklin area includes Pukekohe, Waiuku, Beachlands, Karaka, Clevedon, Whitford, Maraetai and other suburbs.
Shuttleworth said Compass Homes (Franklin) had built hundreds of new homes in Pōkeno alone.
“The company hasn’t made a sale for 12 months,” he said of a desperate situation.
The land at McDonald Rd, Pōkeno - an area where many new houses have been built in the last few years.
Shuttleworth, in his early 70s, was a former chief executive of the Certified Builders Association but resigned from that position in 2005.
He said today his wasn’t the only business which was suffering and he was hearing from many others in the sector about issues continuing with residential building businesses.
The company was incorporated in 2012 and is owned by Capital Investments which is owned by Shuttleworths and his interests.
He emphasised Compass Homes (Canterbury), of which he is the sole director, was continuing to trade. Interests associated with him also own 80 per cent of that company, according to Companies Office records. It was incorporated in 2011 so has been running longer. Shuttleworth stressed there were no issues with that business and it was continuing, in a strong position.
Compass Homes (Franklin) said it was proudly serving the area “from Pōkeno to Pukekohe Our commitment is to deliver high-quality homes that not only meet but exceed your expectations”.
Knowledgeable and friendly staff had been based at 78 Hitchen Rd, Pōkeno, the company said.
Work and Income shows Compass Homes (Franklin) employed seven staff in August 2021 and got $21,600 in support to continue paying them.
The business partly appealed to first-home buyers. It had advertised townhouses in the Mangere area from $569,000. But Shuttleworth said that was not its only market.
Last year, a Compass housing business in the western Bay of Plenty was liquidated and one family complained of losing more than half their $55,000 deposit.
Inflation, a shortage of materials, the extremely high volume of construction, the shortage of labour, the challenges of gaining access to finance and the ongoing impact of the pandemic have all combined to exacerbate legacy issues that have long simmered under the surface.
Just before Christmas, around 1000 workers from building sector labour recruitment business ELE were laid off.
Sacked Filipino carpenter Red Aguhar was this month sleeping in his Toyota Aqua on an Auckland street because he had no money to pay rent.
Red Aguhar says he is "like a shrimp" curled up on the back seat of his car to sleep. Photo / Michael Craig
“I lost my job and I’m sleeping in my car like a shrimp,” said the 47-year-old who was working for ELE until December 20 when its owner called in Deloitte receivers.
That resulted in about 750 Filipino workers losing their jobs and a strong rally by charities to help them last month.
Aguhar was earning about $800 per week on a Jennian Homes housing site in Greymouth until the pre-Christmas layoffs so he drove to Auckland to get support.
He can’t afford to pay rent and has no money for petrol or food.
“I have a family to support, sending money to my daughters, brothers, my mother and my wife,” said the father of two daughters aged 19 and 15, one at university and the other at high school.
He can earn only around $71/week in Manilla, around $250/week in Saudi Arabia where he was before coming here but around $800/week when he worked for ELE.
New house consents have dropped sharply lately.
This month, StatsNZ data showed there were 38,209 new homes consented in the year to November 2023, down 24 per cent compared with the year ended November 2022.
By region, the number of new dwellings consented in the year to November was 15,872 in Auckland, down 27 per cent.
Anne Gibson has been the Herald’s property editor for 23 years, has won many awards, written books and covered property extensively here and overseas.
