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New Consumer Code for Home Builders introduced on 1 April 2010

A new Consumer Code for Home Builders was introduced on 1 April 2010. It is aimed at providing a more streamlined, efficient service to its customers so the conveyancing process runs more smoothly and will apply to reservations from 1 April 2010.

The code is operated and administered through warranty providers, the National House-Building Council (NHBC) and Premier, and  is supported by the Council of Mortgage Lenders, the Home Builders Federation, the Federation of Master Builders, the House Builders Association and the Home Builders Federation Retirement Housing Group.

The code provides that the house builder must prepare a charter monitoring customer’s satisfaction on how  matters are progressing. It will also provide information on dates for delivery  (the recording of estimated construction completion dates and long stop dates in the event of delay), rights to terminate contracts and clarification of verbal undertakings.   If the customer does not feel the builder has complied fully with the code then there is provision for a dispute resolution service. If the builder is found not to have complied with the code they may be struck off the warranty body’s register.

This is a welcome change since the level of service provided by the various home builders is varied and inconsistent and in the past contracts have been biased towards the builder/developer. From a legal professional prospective it is also pleasing to see that there is to be specific information on delivery dates, contract rights and verbal undertakings. It is often difficult dealing with new build properties since agreements are made between the buyer and the builder without a solicitor being involved and when the time for completion approaches much of what has been agreed has not been dealt with.   For example, it may have been agreed with the developer that certain items should be included in the property that may not appear in the specifications/brochure of the property. These must now be documented and are actual contract requirements so they must be included.  
It is hoped that the introduction of the new consumer code will ensure everything is clear to all parties from the outset and the customer has rights to challenge if they feel they have been treated unfairly.

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