‘A light at the end of the tunnel’: State government steps in after building company collapse

The South Australian government will build a road on a long-running housing development in Adelaide’s south, after pleas from homebuyers left in limbo.

Premier Peter Malinauskas announced the government would step in to finish the internal roadworks at the O’Halloran Hill development, where about 20 homebuyers were left with half-built properties on a site without an access road or essential services after the builder, Felmeri Homes, went into liquidation in July.

Mr Malinauskas said homebuyers had not been able to use funds from mandatory building indemnity insurance to finish their properties due to the unfinished access road.

“Builders can’t get access to actually do the work to fix these houses up because there’s no way to get access,” Mr Malinauskas said.

Mr Malinauskas described the “particularly unique” situation as an “unacceptable state of affairs”.

“Ordinarily these types of community roads are completed in advance of the housing construction itself,” he said.

“For whatever reason, that hasn’t occurred at this development.

“And that’s left families … without their dream home, or even able to continue to build their dream home because builders haven’t been able to get access to those properties.”

Building inspector Mike Pearl had called for local or state government to step in and build the road.

“I don’t see any other way around it,” he said.

Mr Pearl, who has worked in the industry for 25 years, agreed the situation at O’Halloran Hill was unique.

“I don’t know of a development that’s had this happen previously,” he said.

Mr Pearl said internal roads and essential services were usually built at a subdivision first, before the houses.

The site has a trench down the roadway, and essential services have not been fully connected.

Opposition Leader David Speirs, whose electorate sits on the boundary of the development, had also called for the government to fund the road.

He said he was grateful a solution had “finally” been found for the “unique” situation.

“These are largely first-home buyers, people in their 20s and 30s who cannot borrow any more because of interest rate rises to finish these projects themselves,” he said.

“They need the government to step in and provide solutions.”

Jess Harrison said she signed a contract in June 2020 and described the “overwhelming experience” in the years since.

“My house is basically at completion and has been since December 2021, with about three or four weeks to completion, I was told then,” she said.

“But because there hasn’t been a road … [and] we don’t know what services we have, my house hasn’t been liveable.

“I’ve purely been waiting for this road.”

Ms Harrison said she was grateful for the government’s support, allowing her and the other homebuyers to “start to feel excited again”.

“We can start to move on now after more than three years, and there’s a light at the end of the tunnel now,” she said.

Ms Harrison said she had been paying a mortgage on the unfinished property as well as rates on top of rent.

“Financially it has been a big burden,” she said.

The state government said an initial cost estimate for the works was more than $1 million, but it was “examining cost recovery options from the developer and associated entities”.