Perth builder Collier Homes collapses amid Australia-wide pressure ...

The collapse of one of Perth's best-known residential building companies is being blamed on mounting pressure on the home construction industry, as one lobby group tips more local builders will go under.

Collier Homes, first established in 1959 and more recently operated by veteran builder Dario Amara, was placed into liquidation earlier this week.

It is the latest in a series of building company collapses that have plagued the industry nation-wide since the COVID pandemic.

Collier Homes is the latest WA building company to go into liquidation. (Facebook: Collier Homes)

Housing Industry Association executive director Michael McGowan said the loss of the company was significant.

"Many in the industry have either worked for or had a home built by Collier Homes over the last 60 years," he told ABC Radio Perth.

Mr McGowan said a surge in costs post-COVID combined with fixed-price contracts for buyers has left many builders walking a financial tightrope.

"Unfortunately over the last three or four years they have been caught in a situation where they've had to absorb some of those price rises," he said.

"It's becoming something daily we tend to read around the country that another builder has been unable to manage their way through those."

Home Builders Action Group chairman Jason Janssen said he had spoken with Mr Amara, who confirmed seven homes remained incomplete.

He said Mr Amara was devastated by the situation.

"It's come at very high cost to him personally," Mr Janssen said.

"He's tried to keep the company going but it entered a position where it was untenable to complete these contracts ... with limited access to available funds and no support from the government.

Jason Janssen says Collier Homes could have been saved if the government's interest-free loan scheme was made available earlier. (ABC News: Tabarak Al Jrood)

"The housing indemnity insurance will kick in and support those clients [who] will need to find a builder to complete their unfinished work [but] unfortunately the contractors and suppliers, if they are owed money, they will lose out."

Mr Janssen claimed the outcome could have been avoided if builders had received the funds from the government's interest-free loan scheme.

"If the money was made available earlier, there is a very good possibility that Collier Homes could have traded through this and completed all those projects," he said.

"In the last eight weeks, we've had seven or eight builders go into administration or liquidation in WA alone … it's happening in a rapid pace and I believe this is just the tip of the iceberg."

Commerce Minister Sue Ellery said Mr Amara's building license expired early last year and was cancelled in June.

Sue Ellery WA Commerce Minister addressing the media about the state's new rental laws. (April 2024)(ABC News: Cason Ho)

She said that even though the number of incompleted projects was small, it would be an "incredibly stressful event" for those affected. 

Ms Ellery said the government had not been alerted to any issues with Collier Homes and there had been no complaints against the company.

A first-homebuyer could have claimed up to $55,000 in post-COVID grants in WA.(ABC News: Gian De Poloni)

Mr Janssen said post-COVID stimulus measures intended to keep the industry afloat have instead contributed to the issues now putting pressure on construction companies.

"[The] industry has been suffering for the last three years since the government grants were released. The price increases that have affected the WA building industry over this time have been unprecedented and could not have been foreseen," he said.

Jason Janssen says COVID stimulus grants ultimately put the building sector under stress.(ABC News: Tabarak Al Jrood)

"It was a really tricky time and probably easy to sit back and say some may have taken on too much. But during that period, it was really hard to get a view on who was doing what."

But Ms Ellery said the government was not at fault for trying to turbocharge the industry.

"We did not require builders to take on more than they had capacity to deliver," she said.

"That was a commercial choice that some of them made. Some companies deliberately put a limit on how many contracts they would sign based on what they knew was their capacity at the time.

"I don't think we can blame anyone. It was an extraordinary set of circumstances."

Ms Ellery said 40 applications had been received from builders for grants through the Home Building Assistance scheme.

The scheme provides builders with up to $300,000 to finish builds already near completion, but which have been held up by banks.

Collier Homes also went into liquidation in 2017, but was then bought by Mr Amara and revived.