The government has agreed to introduce a single mandatory consumer code and New Homes Ombudsman Scheme as proposed by the regulator, so homeowners could challenge developers on quality issues with their homes.
It said it would work with devolved governments to create a consumer code for all housebuilders in Great Britain.
Nigel Cates, chief ombudsman for the New Homes Ombudsman Service, said: “We warmly welcome the government’s commitment to require all housebuilders to join the New Homes Ombudsman and abide by a single quality code. The announcement will ensure all those purchasing new homes will enjoy the same level of protection and recourse to an Ombudsman service no matter who their developer might be.
“We look forward to working with the UK and devolved governments to implement the plans as swiftly as possible.”
Rob Brighouse, chair of the New Homes Quality Board, said: “We welcome the government’s commitment to having a single mandatory consumer code for all housebuilders and activating the New Homes Ombudsman Service for all buyers of new homes.
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“This will mean that there is one single framework (the Code) for all developers to improve the standards of quality and customer service provided to all new homebuyers. We believe that this decision will help to create a level playing field for all new homebuyers; offering the same route for redress and protections offered through the New Homes Ombudsman.
“We will be engaging with government and all stakeholders over the coming weeks and months to help put this into effect.”
More protection for homes on privately managed estates
The government accepted the principle of the CMA’s recommendation to enhance consumer protection for households living under private management, saying the regulator’s measures were addressed in the Leasehold and Freehold Reform Act 2024.
It agreed with the CMA’s concerns that homeowners were not fully aware of charges they may have to pay before buying a new-build home, and said the Leasehold and Freehold Reform Act would cap the turnaround time and cost of sales information requests for ongoing sales for leasehold properties and properties on managed estates.
It also accepted the principle of the suggestion to give guidance to members and directors of residents’ management companies so they could manage the amenities on housing estates.
The government agreed with the CMA’s view that households living under residents’ management company arrangements could face challenges when managing or commissioning services, as well as its observation that existing guidance was limited.
The Government will explore options to provide advice to homeowners on such estates and work with appropriate bodies to identify the information needed to benefit homeowners.
More work was needed for other recommendations made by the CMA, the Government said, such as its proposal to develop an independent consumer satisfaction survey on the quality of new homes and housebuilders’ services, and the suggestion of common standards for public amenities on new housing estates across all devolved governments.
Matthew Pennycook, housing and planning minister, said: “The Government has committed to delivering 1.5 million homes in this Parliament, including the biggest increase in social and affordable housing in a generation.
“The CMA was right to highlight areas for improvement in the housebuilding market. That is why we will empower homeowners to challenge developers over poor quality new homes and bad service, and we will consider the best way to address the injustice of ‘fleecehold’ private estates to bring unfair costs to an end.
“Alongside this, our updated National Planning Policy Framework and the reinstatement of mandatory housing targets for councils will ensure communities have the homes and necessary infrastructure to thrive.”
Sarah Cardell, CEO of the CMA, said: “We welcome the government’s response to our recommendations on housebuilding, which we put forward to get people better protections and open the door to delivering more good quality homes.
“Housing is an essential area for consumers and driving economic growth, so we will assist Government as they take forward our solutions, alongside progressing our wider housing work.”
This article was first published on YourMoney.com‘s sister site, Mortgage Solutions. Read: Govt to make New Homes Ombudsman mandatory and protect privately-managed homeowners
