Housing company chief raises concerns about builders going broke with costs rising

Cavalier Homes owner Dale Paddle made the call on Tuesday when he joined Indi MP Helen Haines for an election announcement.

The Master Builders Association president for Albury-Wodonga said insolvency was a major concern as supply issues bit.

"State legislation has got us tied into fixed price contracts, so that's been a real challenge for a lot of builders," Mr Paddle said.

He said material costs were up 30 per cent in two years.

"If you're signing on a contract and your price goes up 10 or 15 per cent you're losing money," Mr Paddle said.

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"This is something that I think the state governments certainly need to look at and it's a really difficult one because we need to protect the consumers so they don't get taken advantage (of) but also we can't keep letting builders go broke at the rate they're going broke."

Dr Haines launched her proposal for a $2 billion Regional Housing Infrastructure Fund to bolster land suitability for new homes.

Visiting Kitchington Estate at Leneva, she said the fund would provide money to councils to allow them to provide services to blocks more easily.

"Right now in Wangaratta we don't have sufficient sewerage capacity to open up new housing estates, here in Wodonga we're having similar problems," Dr Haines said.

She added Benalla required $10 million worth of drainage works in its west and north.

The federal government does have a National Housing Infrastructure Facility which provides finance for works that will generate new housing supply.

Dr Haines said "not a cent" of that fund had come to Indi.

"We need to not only look at affordability in terms of low interest access to the market, we've got to look at the supply issues," she said.

"This is a really good faith proposal, establish this fund, local governments can make application into it, they can work in partnership with developers and builders and we can get what we need."

In pointing to the heat in the market, Mr Paddle said he had sold a block in the Kitchington Estate for $120,000 around 18 months ago.

"(Now) we've just sold one, three streets across, same-sized block for $220,000, a $100,000 increase on a block of land in one year is really hard for most people to stomach," he said.

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