What to do if your builder goes into liquidation mid-build (NZ)
Building company failures have been common in NZ, and finding out mid-build is frightening — your money and your half-finished home are both on the line. You can't undo the insolvency, but acting quickly protects what you can still protect.
In short
Stop further payments, secure the site, and find out who's been appointed (a liquidator or receiver) — then register as a creditor. You'll likely be an unsecured creditor, so recovery is uncertain. Check any Master Build or Certified Builders guarantee, talk to your insurer and a lawyer, and line up a new builder to complete the work.
Step by step
- 1
Stop paying and secure the site
Make no further payments. Make the site safe and weathertight so the unfinished work doesn't deteriorate while you sort things out.
- 2
Find the liquidator and register your claim
A liquidator or receiver is usually appointed. Watch for their communications and lodge your claim as a creditor — you must be on the list to receive anything.
- 3
Understand where you stand
Homeowners are typically unsecured creditors, ranked behind employees, Inland Revenue and secured creditors. Realistically you may recover little or nothing of money already paid for work not done.
- 4
Check guarantees and insurance
If the builder was a Registered Master Builder or Certified Builder, you may be able to claim under their guarantee. Check your contract works insurance too.
- 5
Secure your consent and records
Get copies of your plans, building consent and any records of building work, and talk to your council about continuing the build under the existing consent.
- 6
Engage a new builder
Bring in a new builder to assess and complete the work. Expect to effectively pay again for anything that was paid for but not finished.
Your rights at a glance
- You can register as a creditor with the liquidator — but recovery is usually limited
- Neither the Consumer Guarantees Act nor the Building Act bails you out financially if a builder fails
- A Master Build or Certified Builders guarantee may help — check the terms
- Retentions held by the builder are often contested in a liquidation
Where to get help
The appointed liquidator / receiver
Register your claim and follow their process
Building Performance (MBIE)
VisitGuidance on builds and problems that may occur
Your lawyer
Advice on your contract, retentions and creditor position
Master Builders / Certified Builders
VisitCheck whether a guarantee applies to your build
Most of these situations involved a builder who already had warning signs in the public record — past court action, liquidations, or a director linked to failed companies. A 30-second check before you sign is far cheaper than any of the steps above.
Related cost guides
Related questions
Sources: Building Performance (building.govt.nz) — builds and problems; Companies Act 1993, Part 16 (liquidations); NZ Herald — building company liquidations reporting. General information for NZ homeowners, not legal advice — every situation differs, so get professional advice for your circumstances. Last updated 2026-05.