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Publish date

2 February 2023

Is the clock still ticking? Where are we now in relation to the New Homes Quality Board Code and New Homes Ombudsman?

New Homes Quality Board Code

In December 2021, The New Homes Quality Board (NHQB) published the New Homes Quality Board Code of Practice (the NHQB Code). The NHQB Code applies to all developers of private-for-sale new homes.

The NHQB previously stated that all developers were required to register by 31 December 2022. It transpires that this “deadline” had been set by the NHQB in anticipation that statutory provisions in the Building Safety Act would be passed supporting the introduction of the NHQB Code. However, whilst the Building Safety Act 2022 was enacted in April 2022, and although it provides the Government with powers to introduce a mandatory code and new homes ombudsman scheme, there is currently no timeframe in which these will be implemented.

The NHQB has confirmed that registering with the NHQB is voluntary and there is currently no deadline by which a developer must register.

However, the NHQB reports that a large number of developers have signed up to the NHQB Code and their ombudsman scheme (The New Homes Ombudsman Service (NHOS)) has been operational since October 2022.

What has happened to the Consumer Code for Home Builders?

On its website in an article published in April 2022, the Consumer Code for Home Builders make it clear it is very much alive and kicking, stating that there are several codes of conduct and that developers can choose which to sign up to, subject of course to the code selected satisfying the main homes warranty providers.

The article states that in its view it is likely that when statutory provisions are passed under the Building Safety Act 2022 to require compliance with a code that the code selected may be an amalgamation of the various codes currently in place. It goes on to say that it will press on with its normal activities in the meantime and that this will include a review of its code although it will continue to work with the NHQB and maintain efforts to strengthen redress for consumers while ensuring a continuous high level of protection for new build home buyers.

What does the future hold? Will the NHQB Code become mandatory?

The current situation risks confusion if not carefully managed. It still seems likely that a code will become mandatory for the applicable developers in the near future. Logically it seems more likely that this will resemble the NHQB Code, although we can find nothing to support this.  The question at this point is really whether there are any imminent market pressures to sign up to the NHQB Code if you have not already done so. Are home warranty providers and lenders making registration at the NHQB a pre-requisite to accessing their products or are home buyers looking for developers who have signed up to the NHQB Code with the promise of the protection of the NHOS that will ultimately afford?

What to do if you still want to sign up to the NHQB Code

Once developers confirm to the NHQB that their preparations are complete they will become Registered Developers. From the point of registration, developers will be expected to comply with the Code and NHOS.

For further information on the registration process please see the NHQB website here.

Some key questions for developers to consider are:

  • Does your reservation process identify and support vulnerable customers; and
  • do your reservation documents have a 14 day cooling off period?
  • What are you as a developer going to offer in respect of pre-completion inspections?
  • Do you have subsidiaries? If so when are they going to register for the Code?
  • Do you have a dedicated after-sales care team to act in compliance with the Code?
  • Does your complaints policy need to be updated in line with the Code?
  • How and when are your employees going to be trained on the Code’s requirements?
  • How will you deal with legacy arrangements and ensure that house buyers know if their purchase is governed by the NHQB Code or by the Consumer Code?

For further information, please contact a member of Thomson Snell & Passmore’s expert development team at info@ts-p.co.uk.

 

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