Compliance And The New Consumer Code

Following the appointment of the New Homes Ombudsman, the New Homes Quality Code is due to be published later this month. But will smaller house builders be able to comply with it?

Last month, the New Homes Quality Board announced that dispute resolution specialist The Dispute Service had been appointed as the New Homes Ombudsman.

This means that, in accordance with the house building industry's new code of practice, the New Homes Quality Code, the Dispute Service will now be responsible for developing the New Homes Ombudsman Service, which will help improve the quality of new build homes and the standard of customer service delivered by house builders.

Coming into force in the new year, the New Homes Ombudsman Service will increase the accountability of house builders and improve customer service standards by enabling buyers of new builds to register complaints about their properties and/or the developers' handling of their concerns with the New Homes Ombudsman, who will then review their case and determine if the New Homes Quality Code has been breached.

As well as improving the quality of new builds, the new Code will also raise the bar in respect of the way in which home builders must handle complaints from customers going forward.

With the new Code not expected to be officially announced until later this month, the exact wording of it remains unknown but early indications suggest that small and medium-sized home builders will struggle to comply with the new rules as the anticipated upsurge in customer queries are likely to result in customer service teams struggling to deal with the increase in demand. This, in turn, could easily result in reputational damage for the home builders in question. So what can they do?

Fortunately, services are available to help businesses overcome any issues caused by the new Code. 

At Consult44, we have more than 50 years' experience in the house building industry and are experts at helping customer service teams of all sizes resolve problems, either by advising on reported issues versus technical standards/tolerances, or by carrying out site inspections and providing professional reports based on our findings. We also offer full training that will bring your staff up to speed with the new processes that are likely to be included in the Code.

If you think your company could benefit from our expertise, you can find out more about our specialist developer support services here.

The Advantages of Seeking Building Warranty Support

Building warranties are insurance policies for newly built homes that are taken out by the builder or developer to protect the buyer and offer them peace of mind that any defects in their home will be put right.

Typically lasting ten years, building warranties cover the defects liability period - this can be split out as:

• The first two years after the property is built, but only where the builder fails to rectify defects.

• The structural liability period between years three and ten. 

During the first couple of years, building warranties require that issues arising as the result of unsatisfactory work carried out by the builders, such as faulty windows, leaks or non-compliant work, are repaired. 

Throughout the structural insurance period, the warranty provider is responsible for major structural problems related to the property, such as issues with the foundations or roof, while minor issues become the responsibility of the homeowner.

However, warranty providers and homebuilders can easily find themselves with conflicting priorities which can spell trouble for a homeowner in terms of getting resolution of issues. As a result, obtaining building warranty support is something every homebuilder should consider. 

Here are four reasons why:

Fewer delays

Because warranty providers tend to focus on compliance with their technical standards via site inspections, they won't usually check designs, often resulting in what can be seen as a reactive rather than proactive approach. 

This can easily cause delays slowing down the whole homebuilding process, resulting in frustrated builders and unhappy buyers.

However, by ensuring you have building warranty support before you submit your application or start building on site, you can avoid delays by ensuring you’re fully aware of your responsibilities and effectively achieve compliance. 

Dealing with site problems

With many variations on build style, complex regulation and related technical requirements, site problems are a common occurrence in the homebuilding industry leading to hold ups and disputes about what can be done to resolve these problems.

Fortunately, with our experience we’ve seen many examples of what can go wrong on construction sites. What’s more, our understanding of warranty providers’ technical requirements and policy coverage and our ability to tailor our technical investigation and construction reports to support appropriate outcomes can help satisfy your liabilities and responsibilities.

Assistance during the 'defects liability' period

During the defects liability period - the first two years after a buyer has taken possession of their property when any defects are rectified - good understanding by the housebuilder of their obligations to the buyer is vital, as any repairs will need to be carried out based on sound diagnosis and appropriate repair whilst inconveniencing the buyer as little as possible and may involve out-of-hours working. 

Once again without the right support in place this can lead to poor diagnosis causing ongoing issues and drag on and causing problems for all parties. We can help you manage your customer relations and also determine what work needs to be carried out and by whom. 

Providing support with new NHQB codes

Building on the last point, the New Homes Quality Board (NHQB) are introducing their new code of practice for property builders (in particular customer service teams) to follow, which is aimed at providing more protection for purchasers of new builds. This could see a significant increase in customer queries and unprepared customer service teams may then struggle to deal with the demand - or simply the handling of the new requirements of the code. 

Poor customer service is both damaging for a developer’s reputation, but also for the satisfaction levels of existing customers. We have the knowledge needed to assist your customer service team with this to help get issues resolved and also help train your staff with the new processes and expectations that stem from the new code. 

Learn more about what we can do for you

As expert consultants with more than 50 years of collective experience, links to specialist surveyors and robust quality control processes, we can help you resolve a wide range of issues, to help you avoid delays and save you time and money with your development.

From helping manage technical issues, to providing inspection services and detailed defect investigation reports, we can take care of the finer points so you can concentrate on what you do best - build new homes.

Find out more about our specialist developer support services here.

The 2021 Autumn Budget - What Does It Mean For Housebuilders?

The Chancellor of the Exchequer has unveiled his Budget for autumn 2021 and it includes the announcement that the housebuilding industry will receive "the largest cash investment in a decade".

While this sounds like great news, it's important to take a closer look at what Mr Sunak actually said and what impact his announcement is likely to have on housebuilders before we start celebrating. So what are the new housing measures?

New homes

The good news is that a multi-year investment of £24 billion to build new homes has been promised, with £1.8 billion to be spent developing 1,500 hectares of brownfield land to free up space for one million new homes, and £11.5 billion being invested in the Affordable Homes Programme.

However, according to a senior research analyst at estate agents Savills, these figures "work out at £11,250 per home - enough to make a difference on some brownfield sites but a drop in the ocean compared to costs on more heavily contaminated or complex sites. It’s also worth noting there simply isn’t enough brownfield land to build anywhere near housing needs."

There are also concerns that the amount promised for new affordable homes will be insufficient as the homes need to be built to new, significantly more expensive, green standards. 

While the shortage of affordable houses remains a serious problem, any new home-building program is welcome. However, until the cost of building environmentally-friendly homes begins to fall, many will argue that these new measures simply do not go far enough.

Stamp duty

Perhaps unsurprisingly, the stamp duty holiday which was announced in last year's Budget has not been extended.

As Britons' homes became more important than ever during the onset of the coronavirus pandemic, the tax cut helped support the property industry, so there is obviously some disappointment that it has come to an end. However, the result of the stamp duty holiday was house prices being driven up by as much as 20%, so its abolition was never likely to be overturned.

In more positive news, at a time when several companies are reporting an increase in enquiries from overseas buyers, no additional taxes on overseas buyers have been introduced.

Planning

£65 million is to be spent improving England's planning system, primarily through digitising the process to make local plans more easily accessible. 

Russell Pedley, co-founder and director of Assael Architecture, said: “We welcome any digitisation that simplifies planning, preferably with a zonal approach that would make it more transparent and easier to hear a range of voices representative of local communities.

“It would also, in our view, attract more national and international funding by providing certainty to investors. In promoting digital means of consultation, we’d expect to see genuine engagement that takes us out of the Stone Age and into the sensible, modern use of planning technology.”

Cladding removal

Also included in the Budget was £5 billion for the removal of dangerous cladding from high rise buildings, which will be partially funded by the Residential Property Developers Tax, which is levied on developers with profits over £25 million at a rate of 4%.

While speeding up the removal of unsafe cladding and not forcing leaseholders to foot the bill is clearly a good thing, many are aggrieved that a blanket tax is being forced on developers while those directly responsible for the unsafe cladding are still not being held to account. With the cost of replacing unfit cladding systems currently diminishing the Building Safety Fund by an estimated £30 million a month, it's not hard to see why.

Furthermore, no mention was made of buildings with potentially unsafe cladding below 18 metres, an issue that is currently seeing thousands of leaseholders unable to sell their homes.

Conclusion

While an extra £24 billion to build new homes is extremely welcome, only time will tell how far that money will stretch and how beneficial it will actually prove to be. 

However, it is worth remembering that the figure could have been much lower so there are certainly reasons to be cheerful, especially when you also factor in the money to overhaul the planning system. And although the stamp duty holiday will certainly be missed, nobody was under any illusion that it would last forever.

At this stage - and it is always worth delaying judgement on the pros and cons of any Budget announcement until after any new measures have had time to take effect - it appears the 2021 Autumn Budget is a decidedly mixed bag for homebuilders.