At board meeting earlier this month, the North-east of Scotland housebuilder, which was incorporated in December 2010, made the decision to move to a formal liquidation process.

Following Mr Reid’s appointment, creditors have been sent a report, which will be posted on the creditor portal. The company’s five employees were dismissed with effect from 23 September.

Mr Reid said: “Due to the increased costs of construction and worsening market conditions, plot sales slowed down considerably. Construction costs of the factory that Morlich Homes Ltd built in Elgin were in excess of the projected sum, causing cash flow problems.

“After a full review of the options, Morlich Homes Ltd ceased trading activities permanently shortly prior to liquidation in order to protect all stakeholder groups.”

The main Morlich Homes assets are the factory in Elgin, nine serviced plots with planning in Elgin and a former showhouse in Buckie.

Current indications suggest that asset realisations should be sufficient to settle the secured creditor in full, leaving a residual balance for preferred and unsecured creditors. These assets are being subject to an independent valuation.

Other assets include plant, machinery and vehicles subject to hire purchase and sundry debtors. These are being valued by Thainstone Specialist Auctions, Inverurie, and will be sold imminently.