Why new home buyers need a New Homes Ombudsman.

TW Snag Light Switch The quality of new homes is getting worse as housebuilders show contempt for their customers by refusing to tackle the issues in their poor quality, defect-ridden new homes.

This government has bent over backwards to help the house building industry, with taxpayer-funded subsidies such as the controversial Help to Buy equity scheme (£791million loaned for 19,394 new homes to 31 March 2014) and the ongoing relaxation of planning rules. So why are Britain’s housebuilders not doing anything to improve the dire quality of the new homes they are building?

The quality of new homes is getting worse as this recent article in the Daily Mail demonstrates; caused by a combination of a lack of skilled tradesmen, insufficient construction time, poor site management and the builder’s CEOs  only caring about profit and numbers (and their bonuses!) – quality doesn’t come first (if it ever did), in fact it doesn’t even come fourth!  To add insult to injury, housebuilders are even routinely refusing to take any action to fix defects that unlucky buyers discover in their new homes once the initial excitement wears off, coming up with “it’s within tolerance” and other excuses in an attempt to justify not fixing defects in their new homes.

Taylor Wimpey 9 months small size

Extensive remedial works still being done in a Taylor Wimpey new home nine months after moving in.

The sad fact is that the quality of new homes and many housebuilder’s reputations are now so bad, an increasing number of new home buyers are employing professional snagging inspectors to independently check for defects in their new homes before they move in. But yet again, housebuilders often refuse point blank to allow access to the new home for buyer’s inspectors until after legal completion, as a matter of “company policy”. This means that any issues identified cannot be fixed prior to occupation and even if the builder does attend to them later, (a big if!) it causes maximum inconvenience for the consumer taking time off work, moving furniture, mess etc.

Leading snagging inspector Brickkickers, confirms that housebuilders are refusing access to their inspector in around 20% of all snagging inspection visits before legal completion. They says half of all snagging inspections they do are post-occupation, also due to the buyer forgetting or leaving it too late to schedule an inspection before they get the keys. So why are housebuilders refusing access to buyer’s inspectors before legal completion? What are they afraid of?  Surely it is in everyone’s interests that new homes are completed and handed over in the very best standard of quality with as few defects as possible. A second pair of eyes can only help – assuming housebuilders also snag the homes they build.

As the housebuilders are showing no intention of taking proactive measures to improve the quality of the new homes they build, consumers need a fully independent means of redress when they have cause for complaint against a housebuilder or the new home warranty provider. The government is currently reviewing the need for more impartial ombudsmen. It would do well to appoint an Ombudsman for the house building industry.

A “New Homes Ombudsman” could help new home buyers with all aspects concerning new homes, ranging from complaints about misleading and incomplete marketing information and underhand selling practices, to poor quality, defect resolution, poor after sales service – awarding proper compensation paid by builders and/or new home warranty providers. Perhaps even just the threat of buyers having access to an official independent means of making a complaint and claiming compensation using an Ombudsman, would be sufficient to force a change of attitude amongst housebuilders to improve both the quality of the new homes they build and their response when buyers do find problems in their new homes.

The New Homes Ombudsman Service could be funded by charging a levy to housebuilders and the warranty providers,  also paying a fee each time a complaint is made against them to cover investigation costs in a similar way to how the Financial Ombudsman Service operates. It would be hoped that every year the Ombudsman would publish statistics, to give consumers an accurate and impartial reference point highlighting the best and worst UK house builders.

The present system of the Consumer Code for Home Builders (run by those within the industry with vested interests) the warranty providers (paid for by housebuilders!) and the HBF (a body representing the house builder’s interests) is not and cannot be regarded as independent. In fact recent case summaries show that the Consumer Code Adjudication Scheme is failing buyers that make a claim, with even the few that are successful, only receiving a small fraction of the amount they claimed. These bodies are not independent and far too incestuous, with house builder CEOs and HBF directors on the NHBC council and NHBC and HBF directors running the CCHB.

As it currently stands, a consumer has more legal protection for buying a £15 electric kettle from Tesco, than they do buying a £250,000 new home from large plc builders such as Persimmon and Taylor Wimpey.

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