The New Homes Quality Code (the Code) was published on 17 December 2021. It follows a 5-year journey which has also seen the New Homes Quality Board constituted in January 2021 and a full consultation with various stakeholders during the Summer of 2021. The Code aims to ensure that new homes are a quality product and to provide buyers with access to remedies should issues arise.
The publication of the Code comes shortly after the announcement in November 2021 of The Dispute Service Limited as the preferred partner to establish a New Home Ombudsman Service. The Ombudsman will be responsible for ensuring the developer has met the obligations under the Code and has a range of sanctions available to enforce compliance.
The Code has 10 fundamental principles, covering interactions with the customer, standards of construction and dealings with the Ombudsman. Some of the obligations included in the Code are:
- Cooling off periods allowing the customer a 14-day period after reservation where they may cancel and receive a refund.
- Time frames for exchange of contracts must be reasonable and not less than six weeks after reservation unless the customer requests an earlier date. This is a big change and a real commitment from the industry to make the home buying experience less stressful for the customer.
- Allowing customers, or a professional of their choice to inspect the home before completion to ensure it is satisfactory.
- A requirement to have an effective after care service in place to deal with snagging and other issues promptly.
Buyers will have the benefit of the Code once the developer has registered with the New Homes Quality Board and has activated its membership. Registration with the New Homes Quality Board will open in the New Year and all new home developers are expected to register by the end of 2022. Developers will have a “get ready” period between registering and activating their membership to get compliant with the new requirements of the Code.
Transitioning from the existing consumer codes to the new Code is sure to be a significant step for the housebuilding industry in 2022. The Code is still hot off the press and parts of the framework are currently being finalised including the charging structure, the date from which developer registration applications will be available (expected late January 2022) and the date that the Ombudsman will go live (expected Q1 of 2022). We are expecting to see a number of further announcements from the New Homes Quality Board regarding these and other matters during 2022 but, for now, the Code has been published and developers will need to be ready for it.