The code was established to make purchasing a newly-built home fairer and more transparent.
What is the Consumer Code for Home Builders?
The Consumer Code for Home Builders is an industry-led and run code of conduct that has been developed to make buying a newly-built home a smoother, fairer and more transparent process.
All house builders that are registered with Britain’s major home warranty providers – NHBC, Premier Guarantee and LABC Warranty – adhere to the code.
The scheme, which launched in April 2010, covers complaints lodged within two years from the start date of the home warranty cover.
You can turn to an independent dispute resolution service available if you feel that your builder has not met the code’s requirements. You could be awarded up to £15,000 if successful.
What are the benefits of this scheme?
Prior to the Consumer Code for Home Builders, you would have had to take a dispute to court if it was not settled by your house builder’s home warranty scheme.
However, under the code, you may now refer your dispute to an independent dispute resolution scheme. It means that buyers can avoid potentially expensive legal action.
What does the code cover?
The code encompasses the entire buying process and as part of that, your house builder must meet 19 separate requirements.
Firstly, you must be given all the necessary information to make an informed decision about buying your home. This includes:
- A written reservation agreement, including reservation fee, what is being sold, the purchase price and how long the price remains valid
- An explanation of the insurance-backed home warranty cover
- A brochure or plan showing the layout, appearance and position of the home, a list of its contents and the standards to which it is being built, if the property is not yet built and ready for occupation
- A description and estimate of the management services the buyer must pay for
Once you have found the new home you want to buy, your house builder must give you a contract that is fair and clear.
The company is required to provide reliable and realistic information about when your new home will be finished, as well as the dates of legal completion and when the home will be handed over to you.
You have the right to terminate the purchase and get your reservation fee back - without any deduction - if there is an unreasonable delay in completing the property.
Under the code, your builder is also required to explain how contract deposits are protected and how they will deal with any other pre-payments.
Once you have moved into your newly-built home, your house builder must provide an after-sales service, as well as information explaining what it includes, who to contact, and information on any guarantees and warranties that come with your new home.
Your house builder is also required to give you advice on any health and safety precautions if you move into a home when building work is still in progress nearby.
What do I do if I have a claim to make?
Builders are required to have a system in place for dealing with complaints. If you are not satisfied with their response, you should contact the home warranty provider within three months of the builder’s final correspondence to the original complaint.
The home warranty body will either deal with the complaint under the terms of the warranty or give you an application form so that you can refer it to the independent dispute resolution service, the Consumer Code for Home Builders’ Adjudication Scheme.
During this process, a trained adjudicator will review written submissions from both you and your house builder, and decide an award.