‘Everything was hard’: Liquidations on the rise in fickle building industry

Saturday, 18 July 2026

Just before Christmas, Brian Honeybone called time on his 50-year building career. The end was not quite as he hoped. Honeybone Builders Ltd, incorporated in 1990, was placed into voluntary liquidation. According to the latest liquidator’s report, the estimated shortfall to creditors is $1.1 million.

“It was pretty hard,” Honeybone said. “It was my dad’s company that he started 60 years ago.”

The circumstances will sound familiar: “It all sort of started at Covid, really. We used up a lot of our reserves … and then we just sort of struggled. One lot of people took us for $80,000 or $90,000.

“Clients are getting worse and worse. Everyone wants more for less. Architects are the same. The expectations. And bloody cost fluctuations was a biggie.

“Everything was hard. I spoke to my lawyer one day and said ‘there’s no such thing as a simple transaction now. There’s no such thing as a simple house now.’”

Honeybone specialised in architecturally-designed residential builds. He has been in construction for decades. He served on the executive of the Registered Master Builders Association. But even he was not immune to the vicissitudes of the industry.

New data shows that the construction sector continues to lead all industries in company liquidations. In the past year 755 firms folded. The next-highest sector, hospitality, recorded 421 liquidations.

Overall, Canterbury fared better than average (there were 3035 liquidations nationally, up 14% on the year before) but the demise of firms like Christchurch’s Honeybone Builders Ltd demonstrate the fickle, and sometimes brutal, nature of the construction business.

Centrix credit agency managing director Keith McLaughlin said the wave of construction failures was a delayed consequence of the pandemic.

“I don’t think that’s going to change in the short to medium term,” he said.

“It’s a flow-on from what was happening in the past. There’s usually a significant amount of time between companies getting into trouble and going into liquidation.”

McLaughlin said the South Island was outperforming the rest of the country.

“It has a far more stable population, lower unemployment and a healthier economic environment.

“House prices are higher in the North Island so they have further to fall.”

Canterbury construction consultant Mike Blackburn agreed the region’s industry remained in “pretty good shape”.

“I had a catch-up with a builder the other day who says things are going gangbusters and sales inquiries are really strong.”

He said major builders like Mike Greer and Oakridge were not sitting on large quantities of unsold stock, and that building consents had increased from two to three years ago.

According to Blackburn’s latest Canterbury Construction report, there were 690 new residential dwellings consented in April, up almost 99% on the same month last year. The value of those consented dwellings was $268m, up 76%.

Blackburn said Canterbury’s affordability was a key driver, with house prices running 30% to 40% below Auckland levels, enough to attract buyers from the north.

The cost of construction was also steady, he said. In April, it was sitting at about $2656 per square metre for Canterbury.

“We’re not seeing a big increase in the cost of building materials. Prices are relatively stable… That’s not to say some building companies aren’t feeling the pinch,” he said.

He said the worst from the fuel crisis fallout was possibly yet to come.

“We might not see costs go up for another three to six months.

“We’re certainly seeing competition in the market and people are buying smaller houses on smaller sections. People are getting less for their money, but that’s OK – they are willing to accept that to get into the market.”

QV quantity surveyor Martin Bisset said margins were squeezed across the board.

“There is work around but certainly margins are lower than what builders would like them to be.

“Most people are trying to keep their company going so would rather have lower profits and get some work than higher profits and no work.

“If someone was thinking of building a house, now would be a good time to do it, but the problem is interest rates have gone up. When mortgage rates go up work dries up, so we have a bit of a catch-22.”

Honeybone Builders Ltd might sympathise with that. So too Totem Studio Architects, which entered liquidation this week with an estimated shortfall to creditors of $105,600.

Totem started life as Brown and Trengrove Architects. It was founded by WH Trengrove in 1922 and was responsible for the Christchurch Star building, parts of Cathedral Grammar School and Lincoln University, and for giving Sir Miles Warren his first job.

In the first liquidator’s report, directors Ian Cattoen-Gilbert and David McKay cited project delays driven by the economic slowdown and an inability to sustain the business despite significant downsizing.

“Project after project have been delayed by customers… After not being successful with some current projects the directors made the difficult decision to place the company into voluntary liquidation.”

Any number of other construction industry firms could tell a similar story. Brian Honeybone, now 67, said the sector of the last five years was not the one he recognised from the previous five decades.

“Everything’s contracted out now … contract carpenters get paid by square metre. Someone else puts the Gib board up, someone else puts the kitchen in … you’re not a builder, you’re a project manager.

“Twenty-five years ago, I would’ve fought my way through it but … I’d just had enough.”