The Government recently published the outcome of its Consultation on the New Homes Ombudsman, launched to redress issues around the purchase of new homes and shoddy building work. NaCSBA fed into the consultation back in August 2019.
Housing Secretary Robert Jenrick confirmed that new legislation will be put in place to underpin a New Homes Ombudsman scheme. This will then place a statutory obligation for developers of new build homes to belong to the new scheme.
This gives consumers swift redress for poor service and products, with the New Homes Ombudsman having powers to hold developers to account and require they to put matters right, and even prevent developers from working in the future if they fail to meet the standards expected.
This will provide new build homebuyers with the protection they require, supporting the government’s ambition to raise the standard of new homes.
Self build and the ombudsman
The position of self-builders was discussed within the consultation response, and, in line with NaCSBA’s submission it concluded: “The scope of the New Homes Ombudsman would not include self-builders unless they plan to sell the property to someone else within a set period.”
While NaCSBA is supportive of this approach, it remains unclear what the period will be, as is the legal definition of self-build. In addition, building with the intent to sell has other consequences, such as in regards to the Community Infrastructure Levy (CIL), which self builders are exempt from.
This is helpful as a self build will typically involve a large number of suppliers of services, skills and resources, and the co-ordination of these elements into a new home, which makes them a poor fit for the Ombudsman scheme.
NaCSBA urges self builders to choose its members for work, as its own Code of Practice offers a route to dispute resolution should a consumer have issues with a contractor. All NaCSBA members (apart form Not for Profit members) must sign up to the scheme as a condition of membership.
However, while self build is referenced, the consultation and its response makes no reference to custom build. NaCSBA highlighted this in its response to the consultation, where it concluded that, given the relative scale of the sector and the challenges of separating self-build and custom build, the best approach was to use the current legal definition. This covers both self and custom build and, on this basis, custom build should also be exempt.
Consequently, NaCSBA will be seeking clarity around this in future, as it is unclear where the options that are currently available, such as at Graven Hill and Squirrel Wood that qualify for Help to Buy Equity Loan, fit in with this. However it is possible that these will be considered as within the scope of the scheme.
