Buying a New Build House - Your Rights

Many people decide to ‘buy new’ from a housebuilder in the belief that it will be a much less troublesome experience than buying somebody else’s home. In reality however, these people go on to find the experience more stressful than they could possibly have anticipated. The reason for this is that the purchase of property is not subject to the Sale of Goods Act or the Supply of Goods and Services Act which cover the majority of purchases, with the result that there is a general absence of consumer rights and legal redress in what is a significant and high-risk purchase. Most consumer complaints relate to:

• The time taken to finish building, despite promises of a much earlier completion date, having sold their old home and paid a significant deposit
• Misdescription / misrepresentation of the property or the area. What consumers were led to believe in terms of the specification of their property or use of land surrounding their property have not been the case.
• The contractual process after exchange of contracts – the 10 day notice period and the inability to claim breach of contract for poor workmanship
• The inability to gain access to ‘snag’ the property before completion
• The quality of finish on moving in and the time taken to come back and rectify the faults
• Absence of customer care in the period after moving in, compared with the time leading up to completion.
• No legal right to damages or compensation even if major problems with the property cause significant disruption and loss of amenity.
• General dissatisfaction with the NHBC, the warranty provider for the majority of new homes.

Choice of housebuilder

In terms of the main UK housebuilders, no one organization can be said to be better or worse than any other with regard to quality of build. They are only as good as the contractors they use at the local level. However, there is a good deal of variation among them in terms of the after-sales care they offer, and it is a good idea to research this by talking to anyone who has moved in to that development. Small local housebuilders can often be said to provide better attention to detail, but it is important to establish what you can expect from them after handover with regard to addressing any defects or damage.

Buyer beware

The majority of new homes will have a warranty underwritten by the NHBC (The National House Building Council). Although this provides the more comprehensive coverage than other warranty providers, it does not guarantee a home without defects or the immediate resolution of any problems you encounter.

If your new home is ‘build complete’ but you haven’t yet exchanged, request a quality audit. This can be carried out by a professional snagging company such as New Build Inspections Ltd who will carry out a detailed inspection and provide you with a comprehensive snagging list of defects to be addressed. You can then insist this be incorporated into the contracts to be exchanged.

If your property is not build complete by the time you’ve exchanged contracts, arrange an inspection prior to legal completion. This will ensure the property is comprehensively snagged before you move in, and there won’t be any nasty little surprises awaiting you when you do!

Notice to complete

Once your property has been issued with its certificate of habitation by the warranty provider (usually the NHBC), the housebuilder will give you notice to complete, during which time your solicitor will draw down funds from the mortgage provider in order to transfer them on the day of completion. The exact number of days will be specified on your contract, although it is usually around 10 working days. The builder may ask you to complete sooner than the contracted number of days but you are quite within your rights to refuse.

During the notice period, your property should be fully completed and habitable. There may be one or two touch ups to do, but in general it should be finished to a reasonable standard of quality with no major faults, damage or unfinished areas. Unfortunately you cannot delay completion on the basis of snagging items, unless they are significant or numerous enough to render the property uninhabitable. Any attempt to delay completion will only precipitate threats of late interest charges from the builder.

After completion

After completion (or handover) of the property, what few consumer rights you have will be guided by the warranty provider (in most cases the NHBC), so refer to your handbook to see what you are covered for and what the procedure is for reporting a defect or making a complaint. In general, you should be contacting your builder in the first instance, but if it is taking unreasonable time or they refuse to respond, then should make a claim through your warranty provider and they will contact the builder on your behalf. As mentioned however, this will not necessarily lead to satisfactory and speedy resolution, and many people find their issues can drag on for months, sometimes years