The Consumer Code for Home Builders (“Consumer Code”) has launched a revised and updated Code, effective from 1 January 2024, which makes some significant changes to the previous edition. Housebuilders who are not yet subject to the New Homes Quality Code (NHQC) (including those that are registered but not yet activated) and still subject to the Consumer Code will need to be aware of the significant changes that will be introduced with effect from 1 January 2024.
Article / 13 Dec 2023
The revised Consumer Code for Home Builders from 1 January 2024
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Who does the Code apply to?
Unless registered with an alternative code scheme (such as the NHQC), subject to certain exceptions, the revised Code applies to all housebuilders registered with the Code’s supporting warranty bodies as listed below:
- National House Building Council (NHBC)
- LABC Warranty
- Premier Guarantee
- Checkmate
Why has the Code been revised?
The Code has been revised to strengthen existing protection for customers by addressing gaps and clarifying guidance, and to align the Code more closely with other codes in the marketplace (in particular the NHQC). A number of the concepts introduced in the NHQC (such as pre-completion inspections) have also now been introduced into the new Consumer Code.
The expectation is that housebuilders (particularly those on their journey to activation under the NHQC) will already be complying with many of the new requirements.
However, for housebuilders to whom the Code applies, it will be important to ensure that all existing practices and documentation do comply, and that any necessary amendments are made ahead of the implementation date of 1 January 2024.
What changes have been made to the Code?
There are a number of changes to the latest edition of the Consumer Code that housebuilders will need to be aware of, including:
- A new focus on customers who may be vulnerable, requiring housebuilders to take steps to identify these customers and help them make informed decisions.
- A new requirement not only to provide training for housebuilders’ own customer service staff, but also to staff employed by any agents used.
- A notable expansion to the pre-contract information that must be provided to customers.
- Changes to the reservation process, including a considerable expansion to the information that must be provided in reservation agreements, as well as a cooling-off period of 14 days for reservations.
- New legal-completion requirements, including a right for the customer or their adviser to undertake a pre-completion inspection of the property to identify any snags.
- An expansion of the requirements for after-sales service and defects resolution.
- A comprehensive update to the complaints and disputes requirements, including additions to the information to be provided to customers, as well as a requirement to provide written acknowledgement of a complaint within five working days.
- An increase in the maximum amount that customers can claim through the Code’s Independent Dispute Resolution Scheme to £50,000.
However, these are only some of the changes, and any housebuilder to which the Code applies is recommended to review the Code in full.