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Home Builder Consumer Code

What is the Consumer Code (“the Code”) for Home Builders?

This is a voluntary scheme that applies to participating developers of new residential properties in England, Wales and Scotland. It only applies to houses or flats purchased from developers registered with a warranty provider participating in the Code.

The Code sets out a number of requirements that participating developers must comply with.

What is the purpose of the Code?

It’s predominantly to protect buyers when purchasing a new build property or newly converted flat. The Code covers everything from the procedure of marketing the property all the way to after-purchase service.

The Code states it’s aims are to ensure buyers:

  • are treated fairly;
  • know what service levels to expect;
  • are given reliable information to make their decisions;
  • know how to access speedy, low-cost dispute-resolution arrangements if they are dissatisfied.

How can I check if a developer is participating in the Code?

If a home warranty provider participates in the Code, there’s a requirement for the developer to comply with the Code. There’s a dedicated website to see which warranty providers are registered to the Code, some household names include NHBC, LABC and Premier Guarantee.

Buyers should ask at the outset if a warranty will be provided, and if so, the name of the provider. The Buyer can then check if the warranty provider is registered with the Code.

Are there any exclusions to the Code?

There are certain buyers that will not have the protection of the Code, such as:

  • a corporate body (Limited Company) or partnerships;
  • a registered social landlord that is going to rent the property;
  • an individual buying for investment purposes;
  • a buyer that has acquired the property via a sub-sale.

The Code also does not cover any personal injury claims, claims that exceed £15,000 or claims about any title defects.

I’m a developer and the warranty that I intend to provide to buyers is with NHBC – do I have to comply with the Code?

Yes, any warranty provider that is registered with the Code will have a requirement for the developer to adopt and comply with the Code. Failure to do this may result in the warranty provider refusing to provide the warranty and the developer having to source an alternative warranty.  The developer may also be excluded from all registers run by other warranty providers that take part in the Code.

I’ve purchased a new build property that has the benefit of a warranty from LABC. I want to complain about a defect in the property – can I pursue a claim under the Code?

There’s a detailed process of the dispute resolution scheme set out in the Code. However, a buyer should first contact the developer to try to resolve any issues. If this is not successful or the buyer is dissatisfied with the developers’ response, then the warranty provider should be contacted. The warranty provider will then review the complaint or, if the complaint relates to a defect outside of the cover provided by the warranty, refer the complaint to the Code’s independent scheme.

After 56 calendar days have passed since first raising the complaint with the developer, the buyer can refer their complaint to the Code’s independent dispute resolution scheme. The referral to the Code’s independent scheme should be referred no later than 12 months after the developers final response.

The Code essentially adds another complaints process separate from the warranty scheme provided with a new build or newly converted property. The complaints process is independent and an Adjudicator will decide whether or not there is a legitimate dispute and a buyer has suffered financial loss as a result of the developer breaching the Code. The maximum compensation available under the Code is currently £15,000. A buyer can only make a complaint within the first 2 years from the date the warranty cover begins.

If you need any advice on the Consumer Code, please contact a member of our commercial property law team in confidence here or on 02920 829 100 for a free initial call to see how they can help.

To speak to one of our experts today, please contact us on 02920 829 100 or by using our Contact Us form for a free initial chat to see how we can help.

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