Ann: Fletcher Building Market Update, page-71

I have no doubt that your perceived views on the state of the building industry are well founded and likely to be very accurate. But this all happens every time we experience inflation together with the consequential interest rate rises.

The business model is flawed but only becomes obvious when inflation rears its ugly head.
The problem is that a builder needs a customer to agree to a build and (usually) for a bank to provide the necessary funding.
The conventional banks require fixed price contracts so the builders, in order to garner the business, have to write fixed price contracts.
This is fine when inflation is almost non-existent and there are no shortages of labour and materials. The builder can comfortably predict his cost and build in his profit and everyone's pretty happy.

The problems occur when the real costs exceed predictions in times of inflation.
For most builders, inflationary costs weren't sufficiently included and this, together with the delay costs generated via the shortage of labour and supplies has left many builders in trouble with their fixed prices in place. This problem passes right through the industry.
And it's not like builders can do a better job of anticipating rising costs. If they do, they're not likely to get the contract in the first place as it goes to a builder who hasn't thought about potential rising costs.

Not sure what the answer is here but fixed price contracts in times of rising prices and labour and material shortages is a bit of a perfect storm.