Any builder who is registered with a warranty provider must abide by the requirements of the
Consumer Code for Home builders requires any house builder registered with a warranty provider (NHBC, LABC, Premier Guarantee) to by the requirements of the code.
Any building found to be
"in serious breach" may have their warranty registration cancelled, making the homes they build un-mortgageable.
Well that is the theory. In practice reality is quite another matter.
House builders are and have been defying requirement 2.5 for sometime, by forcing buyers use their selected
nominated solicitor.
The Consumer Code, NHBC and Office of Fair Trading are all aware of this yet nothing has been done. Not one house builder has stopped this requirement or had their warranty registration cancelled...yet!
But would it be a big deal for any of the large national house builders?
Probably not.
All the large house builders operate as separate regional companies each having its own NHBC registration.
So even if one registration was cancelled, the region could just use the registration of another region and carry on as normal.
The Consumer Code for Home Builders launched in April 2010 is claimed by the industry to be as a result of recommendations in the Barker review 2004.
So it took seven years for the industry to produce it?
More likely it was a result in new
Consumer Protection Legislation introduced in 2008.
Consumer Protection from Unfair Trading Regulations 2008 made it a legal requirement to treat consumers fairly.
The Business Protection from Misleading Marketing Regulations 2008 reinforces the legal requirement not to make misleading or false statements.
Breaking these regulations, which requiring buyers use a specific solicitor does, can result in an unlimited fine and up to two years imprisonment on conviction in a Crown Court.
Sales Advisors and their CEO could face prison.
However, what does the Code mean for homebuyers?
Not that much. House builders have agreed (in theory) to abide by the requirements of the
"voluntary industry code that is led and run by the industry." The Code aims to ensure customers:
Are treated fairly
Know what service levels to expect
Receive reliable information upon which to make their decisions
Know how to access dispute resolution arrangements
Buyers do have access to a fairly quick and relatively inexpensive
Dispute Resolution Scheme.
But the maximum that can be claimed is only £15,000 and you can only claim £250 for inconvenience. It is not for matters arising from claims under the warranty.
