Consumer Code Consultation
September 2015
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1. Introduction
The Consumer Code for Homebuilders is an industry led code of conduct for
builders, which was developed to make the home buying process fairer and
more transparent for purchasers.
The Code applies to all homebuilders registered with the UK's main new home
warranty providers; NHBC, Premier Guarantee and LABC Warranty and consists
of 19 requirements and principles that home builders must meet in their
marketing and selling of homes and their after-sales customer service.
The Code came into effect on 1st April 2010 since when it has been providing
protection and rights to purchasers of new homes, ensuring that all new Home
Buyers are treated fairly and are fully informed about their purchase before and
after they sign the contract.
The Code reinforces best practice among Home Builders to make sure the level
of information and customer service provided by all Home Builders is
consistently high. It builds on successful efforts already made by the industry to
improve consumer satisfaction in recent years.
During the first four years of operation of the Code, I have been enormously
impressed by the commitment of the leaders of the Home Building Industry to
ensure it has the priority and prominence it deserves. This commitment has
been matched by many companies, both large and small, throughout the UK
and as a result, the Code continues to play a significant role in ensuring
consumer confidence remains high.
The credibility of the Code has been recognised by the ‘Help to Buy Scheme’ in
England and Scotland, with the requirement that the terms of the Code should
be observed by home builders promoting Help to Buy.
However, as the Code enters its fifth year, the Management Board1 know it is
important not to become complacent about the challenges the Code faces if
it is to remain credible, visible and relevant to consumers and continues to be
an important priority for the Industry.
Noel Hunter (OBE) Chairman; Mike Freshney – Chairman of Advisory Forum; Ian Davis – Operations Director of NHBC; Gary
Devaney – Group Chairman and CEO of MD Insurance Ltd; Philip Hogg – CEO of Homes for Scotland and Sue Green, Manager
of Stratford Upon Avon and District Citizens Advice
1
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Market research has been conducted annually since the inception of the
Code and there is some evidence of a reduction in awareness levels, notably
at the first point of contact with the Home Buyer and amongst estate agents
who work on behalf of Home Builders. Whilst both the Industry and estate
agents have invested significantly in staff training, it is inevitable that the churn
of staff in the Industry makes this an on going priority.
There is also a year-on-year increase in the overall number of cases that have
been referred to the Code’s Independent Dispute Resolution Scheme. While
this may be as a result of the higher volume of houses being built across the UK,
the indications are that more cases are succeeding either in part or fully, in
favour of the Home Buyer. This may indicate that compliance with the Code
has fallen short in some measure.
Furthermore, the Code is looking to gain approval through the Chartered
Trading Standards Institute’s (CTSI) Consumer Codes Approval Scheme, which
has succeeded the previous Office of Fair Trading scheme. This facilitated selfregulation aims to bolster consumer protection and improve customer service
standards by the approval and promotion of codes of practice; setting out the
principles of effective customer service and recognising approved traders.
In return, consumers can look out for the CTSI approved code logo when
searching for a trader, and be confident that any approved business they
choose has a proven commitment to honest business and higher customer
standards, such an application may require revisions to the Code’s
requirements.
The Code’s Management Board wishes to seek the views of Home Builders,
trade bodies and all other stakeholders on the overall scope, operation and
impact of the Code as detailed within this consultation.
We look forward to seeing responses from all of those with an interest in the
Code and to ensuring it remains relevant to the home building industry,
consumers and other key stakeholders.
Noel Hunter OBE
Chairman Consumer Code Management Board
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2. Purpose
The purpose of this consultation is to seek the widest possible perspective on
the Code to ensure it retains and builds upon the strengths of the current
requirements, and support of the Industry, ensuring it remains both viable and
credible when reducing consumer detriment in the new home buying market.
Responses to this consultation will inform any revisions to future changes of the
Code and seeks views on those proposed as a result of feedback already
received by the Code’s Management Board. The aim is ensure the Code
continues to meet the needs of Home Buyers in terms of driving up industry
standards and customer satisfaction in the new home buying market.
3. Current Code Provision and Case for Change
After its launch, the Code was originally reviewed in 2012 and changes were
made as a result of the feedback received. The Code is now in its third edition.
However, in light of a further two years’ experience of operating the Code and
feedback from our mystery shopping; adjudications from our Independent
Dispute Resolution Scheme; discussions with stakeholders and applicants to
become a User of the Code, the Code’s Management Board have committed
to a further review in 2015 for implementation of any changes required in 2017.
In addition, we are aware from the requirements contained within the core
criteria, that to meet CTSI’s Consumer Codes Approval Scheme, we will need to
revise and enhance the Code in specific areas. The proposals for change are
outlined in more detail below taking into account those requirements.
The review is also an opportune time to consider whether there is anything
contained within the Code that either could/should be removed given it was
launched some five years ago and requirements/developments may have
moved on since then.
4. Proposals for change
As outlined above, there are a number of drivers behind reviewing the Code
and the examples of proposed changes are offered to prompt thought and
discussion, as we want to hear what you think.
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To assist with the co-ordination of responses, we ask that you provide your
feedback and views using the attached questionnaire. The proposals are
broken down into three areas:
1. The Consumer Code requirements and the non-mandatory good practice
guidance for Home Builders.
2. Revisions required in light of the application to CTSI Consumer Codes
Approval Scheme.
3. General Code matters including: the operation of the Adjudication Scheme;
the arrangements for monitoring and auditing compliance with the Code; the
material available on the Code website and the governance arrangements
including the application process for new warranty bodies and the assessment
of New Home Cover in the market place.
A summary of all the questions posed can be found in section 4 (page 25)
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Section 1
Proposed revisions to the Consumer Code requirements and the nonmandatory good practice guidance for Home Builders
1. Code Introduction
Contained within the introduction of the Code, paragraph 5 explains the Home
Warranty Bodies have agreed to require all their registered builders to adopt
and comply with the Code as a registration condition. If a Home Builder is
found to be in serious breach of the Code, Home Warranty Bodies can apply a
range of sanctions. These include removal from the relevant Home Warranty
Body’s register and exclusion from all registers run by other Home Warranty
Bodies that take part in the Code scheme.
Given that other Home Warranty Bodies have been approved under CTSI’s
Consumer Codes Approval Scheme, it is proposed to extend the exclusion from
all registers run by Home Warranty Bodies that take part in the Code Scheme or
CTSI’s scheme. This is to prevent Home Builders from “Code or Warranty
hopping” should they fail to meet the requirements.
Q 1. Do you agree with this approach? Please say if not why not and what
difficulties you might perceive. Conversely, what benefits do you perceive by
extending the exclusion to other warranty bodies operating under CTSI’s
scheme?
2. Making the Code Available
Section 1.2 of the Code requires Home Builders to display the Code (for
example in sales packs, in public places such as site offices or on a Home
Builder’s website) and give, without charge, a copy to customers who ask for it
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and to all Home Buyers who reserve a home. The guidance to home builders
says that the Code should also be clearly displayed and says that in doing so it
may be “made available on your website”.
It is clear from mystery shopping and customer surveys that many consumers
and Home Buyers are not aware of the Code. To maximize awareness and
distribution of the Code it is proposed that the visible display of the Code in Site
Sales and Estate Agents offices at the point of sale be mandatory.
Q 2. Do you agree with these proposals in relation to making the Code more
visible within site sales offices/at the point of sale? Please explain your answer,
saying what difficulties you foresee in complying and further, what you think
could be done to raise (or maximise) awareness of the Code.
3. Appropriately trained customer service staff
Section 1.4 of the Code requires Home Builders to provide suitable training to all
staff who deal with Home Buyers about their responsibilities to them. The
guidance states that where a Home Builder uses agents to sell their homes, they
should ensure they are trained to the same level and also ensure that Agents’
responsibilities are clearly stated and explained in their contract arrangements
with their Estate Agent.
Mystery shopping surveys conducted show that awareness of the Code across
site sales staff and estate agents is materially inadequate.
Given that the Code provides free on-line training for Home Builders and
affiliated companies, including estate agents, to enable them to comply with
the Code requirements, we are seeking your views on whether such on-line
training should be made mandatory.
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Q3. Do you consider making the on-line training compulsory will help with the
provision of appropriately trained customer service staff? If not, what
alternative methods could be introduced that would help Home Builders
and/or their agents comply and raise awareness of the Code?
4. Sales and Advertising
Section 1.5 of the Code requires all sales and advertising material to be clear,
truthful and comply with the law.
The guidance the Code provides to Home Builders on this matter makes
reference to the Property Misdescriptions Act 1991, saying that any services
offered must not be wrongly described and information must not be false or
misleading.
The Property Misdescriptions Act 1991 was repealed in October 2013 and
replaced with the Consumer Protection from Unfair Trading Regulations 2008. As
well as not misleading buyers with factually incorrect information, Home Builders
and estate agents now have to take care to ensure that they don’t omit
information that is clearly important, or that would affect the value or sale of
the property.
It is proposed to revise the guidance to incorporate the changes to the
legislation.
Q4. Do you foresee any difficulties in amending the guidance to comply with
the change in legislation? If so, please explain why and/or what else you would
expect to see.
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5. Pre-contract information
Section 2.1 of the Code requires Home Buyers to be given enough prepurchase information to help them make suitably informed buying decisions.
This includes a description of any management services and organisations to
which the Home Buyer will be committed and an estimate of their costs.
To help home builders and their agents comply with the Consumer Protection
Regulations, we propose to widen this requirement to cover any fees that a
home buyer may be required to pay including, but not limited to, transfer
charges. Such charges typically impose a conditional obligation on the tenant
to pay a fee when they sell and the title to the lease changes hands or
property is let. The requirement to provide information on other fees would also
apply to charges that go in to a sinking fund (a fund to help cover any
unexpected maintenance or repairs, like replacing the roof), held on trust for
the tenants for the upkeep of the building.
While the precise costs of such provisions may not be known until nearer
completion of the home, it is proposed that estimates of such costs, along with
an explanation of how and in what circumstances these may change, are
made known to the Home Buyer no later than Reservation Agreement stage
and should be included on such an Agreement.
Q5a. Do you agree that all fees as outlined above should form part of the presale information to be provided to Home Buyers? If not, please explain.
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Q5b. Bearing in mind that all such information needs to be disclosed under the
consumer protection regulations to help the Home Buyer make an informed
decision, do you consider the provision of an estimate of the costs and the
circumstances under which they might change, is best done at Reservation
Agreement stage? If not please explain when you consider it is appropriate for
the information to be provided and why.
Section 2.5 of the Code requires Home Builders to advise Home Buyers to
appoint a professional legal adviser to carry out the legal formalities of buying
the Home and to represent their interests. The guidance advises that Home
Builders should not restrict the Home Buyer’s choice of legal representative.
Complaints received by the Code and the Independent Dispute Resolution
Scheme shows that some Home Buyers are also having their choice of financial
adviser restricted. It is proposed to extend the requirement under section 2.5 to
include the choice of financial advisers, as well legal representatives, should
not be restricted.
Q5c. Do you consider that the choice of a Home Buyer’s financial adviser
should not be restricted? Do you perceive any difficulties in including this
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requirement within the Code? If so, please explain what those difficulties might
be.
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Section 2
Revisions to the Code required in light of Chartered Trading Standards Institute’s
Consumer Codes Approval Scheme.
CTSI’s Consumer Codes Approval Scheme (CCAS) is facilitated self-regulation.
It aims to promote consumer interests by setting out the principles of effective
customer service and protection. It goes above and beyond consumer law
obligations and sets a higher standard, giving consumers a clear indication through the right to display the CTSI Approved Code logo - that code members
can be trusted.
CCAS aims to reduce consumer detriment and codes will only be approved if
they can clearly demonstrate that they are contributing to this objective.
Codes approval is a rigorous and intensive process for code sponsors.
The Code’s Management Board feel it is important to show how the Code can
help bolster consumer protection and improve customer service standards by
the approval of CTSI under their CCAS. Once approval has been granted,
Home Buyers can look out for the CTSI approved code logo when searching for
a Home Builder and be confident that any approved business they choose, has
a proven commitment to trade honestly and with high customer standards,
giving a competitive edge of their rivals. As such, an application has been
made to CTSI for the Code to be approved under their scheme and as a result,
there are some amendments required to meet their requirements.
6. Dealing with people in their own homes
Criterion C5 of CTSI’s CCAS requires the Code to address how Home Buyers will
be treated when in their own homes. While it is highly unlikely in the
circumstances of buying a new home that the Home Builder will engage in
other activities that may lead, by way of example, to high pressure selling or
indeed engage in any cold calling activities, newly built and occupied homes
do require a period of ‘running in’ during which the building fully acclimatises
and adjusts to normal living temperatures and conditions.
During this process Home Builders have a responsibility for attending to any
remedial work that may arise. As such, it is proposed that in future revisions of
the Code, we will require Home Builders to take into account the Home Buyer’s
vulnerability when dealing with them in their home, for example if the Home
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Buyer is elderly, has a disability or English is not their first language and further
assistance might be required.
Q6. Do you believe the Code should be more prescriptive in terms of saying
how Home Buyers should be treated when Home Builders are dealing with
them in their own home? Do you have examples of where a Home Buyer may
have been deemed vulnerable in the circumstances and how would you
propose the Code addresses this? How do you consider this aspect of the
Code might be measured to ensure compliance?
7. Addressing high pressure selling
Criterion C6 of CTSI’s CCAS requires the Code to address high pressure selling,
as appropriate to the activities of Code members.
The Code requires Home Buyers to be given enough information to help them
make suitably informed purchasing decisions before they make a binding
commitment. Furthermore, the Reservation process required by the Code
provides a known period of several weeks in which the Home Buyer can fully
consider and evaluate the purchase and its terms before making a binding
commitment by exchanging contracts for sale and purchase. It is expected
they will have obtained the full advice of their legal representative. This period
eliminates the likelihood of ‘pressured’ sales.
However, in future editions of the guidance provided to Home Builders, they will
be reminded that their customers should not be subjected to high pressure
selling techniques and further that the needs of vulnerable customers should be
considered. In this context, such high pressure selling techniques may include,
but are not limited to: encouraging a Reservation by implying there are other
interested parties or that there is an imminent price increase due where there is
neither; offering a financial incentive for an instant decision or encouraging a
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Reservation by refusing the opportunity to personalise the New Home where
the stage of construction would still allow it.
Q7. Are you aware of any high pressure selling techniques not addressed by
the Code? If so, please provide further details. Do you consider that the
suggested revision to the guidance goes far enough to protect Home Buyers in
relation to high pressure selling techniques? If not, please explain why and what
further protection you require.
8. Vulnerable consumers
Criterion C13 of CTSI’s CCAS requires the Code to address the additional
effort/help to be provided to vulnerable consumers.
1.2 of the Code already requires that Home Builders give consideration and
help to those customers who have special needs (for example those whose first
language is not English, or they have impaired sight). However, it is proposed
that in future editions of the Code, we will emphasise further the need for Home
Builders to make the necessary provisions for a Home Buyer’s vulnerability and
include a definition within the terms which defines a vulnerable consumer as
“people who cannot choose or access essential products and services which
are suitable for their needs or cannot do so without disproportionate
effort/cost/time.”
Q8a. Do you consider the proposed definition of vulnerable consumer to be
appropriate for the new home building market? If not, what alternative
definition would you propose? How do you envisage the Code monitoring
compliance with this requirement?
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Q8b. How do you envisage that any future revisions to the training, requiring
Home Builders to take into account the Home Buyer’s vulnerability when
dealing with them during the pre-purchase and sales process, can best be
delivered?
Q8c. What action do you think Home Builders could take to ensure the needs of
vulnerable consumers are met in relation to the requirements of the Code?
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9. Handling complaints
Criterion D3 of CTSI’s CCAS requires the Code to include the availability of a
low cost, speedy, responsive, accessible and user-friendly alternative dispute
resolution for consumer disputes. The Code already provides access to an
Independent Dispute Resolution Scheme which sets out that a Home Buyer
must first complain to their Home Builder and give the Home Builder the
opportunity to investigate and put things right. If a Home Buyer is unhappy with
the response to the complaint(s) they have raised with their Home Builder, then
they may refer the complaint to the Independent Dispute Resolution Scheme.
There are time limits that currently apply for anyone wishing to use the
Independent Dispute Resolution Scheme and a case has to be brought within
three months after the date of the Home Builder’s final response to the Home
Buyer’s original complaint, or within three months after the date of the original
complaint, whichever is the later. However, the Alternative Dispute Resolution
(ADR) Directive that comes into effect from 9 July 2015, provides that all traders
selling to consumers will have access to a certified provider of ADR services in
their sector and with effect from 1 October 2015, all traders selling to
consumers, whether or not they intend to use ADR, will need to: a). Give the
consumer details of the certified ADR provider in their sector AND b). Inform the
consumer about whether they intend to use that provider.
While we anticipate Home Builders citing the Code’s Independent Dispute
Resolution Scheme (as opposed to any other scheme), the Directive allows a
consumer to bring their complaint after 56 days have elapsed since first raising
it with the Home Builder. In addition, the Directive also states that the timescale
in which a Home Buyer can bring a complaint is within 12 months from the date
the Home Builder advises they are unable to resolve the matter and provides
the details of the ADR scheme.
In addition to the required changes to the timescales within which a Home
Buyer can bring their complaint, the Alternative Dispute Resolution Directive
states that any scheme should be free of charge for the Home Buyer or a
“nominal fee”, irrespective of the value of the claim. Currently the fee to a
Home Buyer for bringing a claim to the Independent Dispute Resolution
Scheme is £120 (including VAT) although this may be refunded if the
Adjudicator agrees with the Home Buyer’s claim against the Home Builder. In
2014, 56 per cent of the Home Buyer’s registration fees were refunded.
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Q9a. Given the legislative requirement to comply with the Alternative Dispute
Resolution Directive, do you foresee any difficulties with the timeframes that are
defined in which a Home Buyer can bring a complaint to the Independent
Dispute Resolution Scheme? If so, please explain.
Q9b. Given that the Directive requires a “nominal fee” to be charged to the
Home Buyer, do you consider £120 inclusive of VAT is still appropriate? If not,
please state what sum you think this should be and why?
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Section 3
General Code Matters
Sections 1 and 2 of this consultation addresses areas of the Code that the
Management Board considers requires amendments and details the reasons
behind the proposed changes.
However, we are also keen to hear your views on the operation and delivery of
the Code not specifically covered under these previous sections and would
welcome your feedback on these matters.
10. Operation of the Independent Dispute Resolution Scheme
There will be changes required to the operation of the Independent Dispute
Resolution Scheme (IDRS), for the reasons outlined above.
Q10a. What further changes, if any, would you wish to see in relation to the
IDRS? Please explain your reasons for the change and give examples where
appropriate.
Q10b. Do you consider the current anonymised case summaries (which can be
viewed at: http://consumercodeforhomebuilders.com/wpcontent/uploads/2015/07/Adjudication-Case-Summaries-Jan-2013-May2015.pdf) are helpful to Home Builders and Home Buyers in understanding what
the dispute resolution process covers, and what is considered to be
unacceptable practice? If not, what further information in relation to the
adjudications do you consider would be helpful and why?
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Q10c. Do you consider the application process easy and the overall timeframe
for having complaints dealt with reasonable? Please explain your answers
giving examples where appropriate.
11. Arrangements for monitoring and auditing compliance with the Code
The effectiveness of the Code is currently measured in a number of ways:
 Customer satisfaction surveys
 Telephone surveys of home builders and estate agents
 Mystery shopping
 Auditing of Contracts of Sale
 Auditing of Reservation Agreements
 Complaints Monitoring
 Lawyer Research
Not all members can be monitored all of the time, therefore monitoring relies
on sample estimates that are representative of the population. The monitoring
programme is designed to provide the most efficient monitoring, making
effective use of resources and given the skewed structure of the industry.
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Sampling plans are therefore based on a number of principles including each
homebuyer should be equally well represented in the sample; builder size and
selling agent should be considered in terms of risk factors and that there should
be a representative geographical.
Results of the monitoring undertaken by the Code are not fed back to
individual builders, other than by exception, if there is a non-compliance or
poor performance issue.
The monitoring is however fed back through stakeholder groups such as the
Code’s Advisory Forum, HBF Legal and Sales and Marketing Group and Homes
for Scotland. In addition, feedback is provided through the newsletters of
warranty bodies, the Code’s quarterly newsletter and through the training
programme.
Q11. Are you satisfied with the current arrangements for feeding back
compliance of the Code to a Home Builder? If not, what further would you like
to see? Please explain your answer giving examples where appropriate.
12. Material available on the Code website
The Code has its own website: www.consumercodeforhomebuilders.com
whereby all information on how the Code benefits Home Buyers is freely
available. Information on the Code’s website includes, but is not limited to,
information on the Independent Dispute Resolution Scheme, Annual Reports,
anonymised adjudication case summaries and details of the supporting Home
Warranty Providers.
The website also provides access to the free on-line training material and
toolkits for Home Builders and their agents. It also provides the Consumer Code
requirements, with Builder Guidance, in clear print versions and in Welsh.
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Q12. What further information, if any, would you like to see on the Code’s
website? Please explain how this might assist you.
13. Code’s governance arrangements
While the Consumer Code has been founded by NHBC and MDIS, a
Management Board is responsible for the day to day operation of the
Consumer Code, consisting of: Noel Hunter OBE: Independent Chairman; Ian
Davis: Operations Director of NHBC; Gary Devaney: Group Chairman and Chief
Executive Officer of MD Insurance Services Ltd; Mike Freshney: Member of HBF
and Chairman of the Consumer Code Advisory Forum; Susan Green: Manager
of Stratford upon Avon Citizens Advice Bureau and Philip Hogg: Chief Executive
of Homes for Scotland. An independent secretariat supports the Management
Board.
The Consumer Code’s Management Board is supported by an Advisory Forum
which has been instrumental in helping drive up industry standards across a
number of years. The Advisory Forum is an industry-wide body that represents,
consults and advises on Code content, its practical application and operation
through which changes and improvements are channeled and lessons learned
fed back to the industry.
The Chairman of the Advisory Forum and two elected representatives from the
Forum sit on the Code’s Management Board.
Q13. Are you satisfied with the current governance arrangements for the Code
and that there is the right blend of independence, industry and consumer
representation? If not, please explain your answer stating how you would like to
see it changed and the benefits you would expect to see from doing so.
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14. Applicants to become a User of the Code.
We were pleased to see the credibility of the Code recognised by the ‘Help to
Buy Scheme’ in England and Scotland, with the requirement that the terms of
the Code should be observed by Home Builders promoting Help to Buy.
Mortgage lenders have also seen it as an important consumer safeguard,
linked to mortgage provision, and Lloyds have required all warranty providers to
either be a User of our Code or a member of CTSI’s Consumer Code’s Approval
Scheme. We have as a consequence, been approached by other Warranty
providers who wish to become Users of the Code.
Following wide consultation and also feedback from the Advisory Forum, the
criteria for applicants to become Users of the Consumer Code for Homebuilders
were developed to help other warranty providers who may wish to apply, they
can be found at the following link:
http://consumercodeforhomebuilders.com/wp-content/uploads/2015/04/CCApplication-Guidelines-final.pdf.
In conjunction with reviewing the scope of the Code itself, we would like to
invite views on the criteria for applicants (warranty bodies that provide New
Home Cover) who want to be Users of the Code.
Q14a. Are you satisfied that the current Guidelines for applicants to become a
User of the Code are, in general, fair and reasonable for applicants while
ensuring that the warranty bodies who operate the Code follow good practice
so that consumers are provided with adequate financial protection to meet
their needs? Please explain your answer.
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Q14b. There is a range in the level of financial protection and scope of cover
provided in the New Home Cover market. Do you consider it would be in the
interests of consumers to have a single standard of cover? Alternatively, do you
consider there should be minimum levels of financial protection and scope of
cover specified for the principal elements of the warranty required by the User
Guidelines stated below, and if so please explain your answer:
 Insolvency protection
 Two year builder liability protection
 Structural insurance period protection (a further eight years)
 Contaminated Land and Building Regulation cover where applicable.
15. Miscellaneous
In light of experience of operating the Code since 2010, and feedback from
our mystery shopping; adjudications from our Independent Dispute Resolution
Scheme and discussions with stakeholders, the review provides an opportune
time to consider not only how we might want to strengthen it, but also if there
are elements of the Code that are no longer required/necessary.
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Q15. What, if anything, do you consider could or should, be removed from the
existing Code and why?
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Section 4. Summary of questions
To assist with the completion of this consultation, please find a summary of the
questions being posed:
Q 1. Do you agree with [the] approach [to extend the exclusion from all
registers run by Home Warranty Bodies that take part in the Code Scheme or
CTSI’s scheme to prevent Home Builders from “Code or Warranty hopping”
should they fail to meet the requirements]? Please say if not why not and what
difficulties you might perceive. Conversely, what benefits do you perceive by
extending the exclusion to other warranty bodies operating under CTSI’s
scheme?
Q 2. Do you agree that having the Code on display within sales offices/at point
of sale should be mandatory? If not, please explain what difficulties you foresee
in complying and further what you think could be done to raise (or maximise)
awareness of the Code.
Q3. Do you agree that making the on-line training compulsory will help with the
provision of appropriately trained customer service staff? If not, what
alternative methods could be introduced that would help Home Builders
and/or their agents comply and raise awareness of the Code?
Q4. Do you foresee any difficulties in amending the guidance to comply with
the change in legislation [from Property Misdescriptions Act 1991 which was
repealed in October 2013 and replaced with the Consumer Protection from
Unfair Trading Regulations 2008]? If so, please explain why and/or what else you
would expect to see.
Q5a. Do you agree that all known fees [that a home buyer may be required to
pay including, but not limited to, transfer charges] should form part of the presale information to be provided to Home Buyers? If not, please explain.
Q5b. [Bearing in mind that all such information needs to be disclosed under the
consumer protection regulations to help the Home Buyer make an informed
decision,] do you consider the provision of the costs is best done at Reservation
Agreement stage? If not please explain when you consider it is appropriate for
the information to be provided and why.
Q5c. Do you consider that the choice of a Home Buyer’s financial adviser
should not be restricted? Do you perceive any difficulties in including this
requirement within the Code? If so, please explain what those difficulties might
be.
Q6. Do you believe these proposals go far enough in saying how Home Buyers
should be treated when Home Builders are dealing with them in their own
home [taking into account the Home Buyer’s vulnerability]? Conversely, do you
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consider [the proposals outlined] too wide? How do you consider [[taking a
Home Buyer’s vulnerability] might be measured to ensure compliance?
Q7. Are you aware of any high pressure selling techniques not addressed by
the Code? If so, please provide further details. Do you consider that the
suggested revision to the guidance goes far enough to protect Home Buyers in
relation to high pressure selling techniques? If not, please explain why and what
further protection you require.
Q8a. Do you consider the proposed definition of vulnerable consumer to be
appropriate for the new home building market? If not, what alternative
definition would you propose? How do you envisage the Code monitoring
compliance with this requirement?
Q8b. How do you envisage that any future revisions to the training, requiring
Home Builders to take into account the Home Buyer’s vulnerability when
dealing with them during the pre-purchase and sales process, can best be
delivered?
Q8c. What action do you think Home Builders could take to ensure the needs of
vulnerable consumers are met in relation to the requirements of the Code?
Q9a. Given the legislative requirement to comply with the Alternative Dispute
Resolution Directive, do you foresee any difficulties with the timeframes that are
defined in which a Home Buyer can bring a complaint to the Independent
Dispute Resolution Scheme? If so, please explain.
Q9b. Given that the Directive requires a “nominal fee” to be charged to the
Home Buyer, do you consider £120 inclusive of VAT is still appropriate or should
this sum be reduced. If the latter, please state what sum you think this should be
and why?
Q10a. What further changes, if any, would you wish to see in relation to the
IDRS? Please explain your reasons for the change and give examples where
appropriate.
Q10b. Do you consider the current anonymised case summaries (which can be
viewed at: http://consumercodeforhomebuilders.com/wpcontent/uploads/2015/07/Adjudication-Case-Summaries-Jan-2013-May2015.pdf) are helpful to Home Builders and Home Buyers in understanding what
the dispute resolution process covers and what is considered to be
unacceptable practice? If not, what further information in relation to the
adjudications do you consider would be helpful and why?
Q10c. Do you consider the application process [for IDRS] easy and the overall
timeframe for having complaints dealt with reasonable? Please explain your
answers giving examples where appropriate.
Q11. Are you satisfied with the current arrangements for feeding back
compliance of the Code to a Home Builder? If not, what further would you like
to see? Please explain your answer giving examples where appropriate.
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Q12. What further information, if any, would you like to see on the Code’s
website? Please explain how this might assist you.
Q13. Are you satisfied with the current governance arrangements for the Code
and that there is the right blend of independence, industry and consumer
representation? If not, please explain your answer stating how you would like to
see it strengthened and the benefits you would expect to see from doing so.
Q14a. Are you satisfied that the current Guidelines for applicants to become a
User of the Code are, in general, fair and reasonable for applicants while
ensuring that the warranty bodies who operate the Code follow good practice
so that consumers are provided with adequate financial protection to meet
their needs? Please explain your answer.
Q14b. There is a range in the level of financial protection and scope of cover
provided in the New Home Cover market. Do you consider it would be in the
interests of consumers to have a single standard of cover? Alternatively, do you
consider there should be minimum levels of financial protection and scope of
cover specified for the principal elements of the warranty required by the User
Guidelines stated below, and if so please explain your answer: Insolvency
protection; two year builder liability protection; Structural insurance period
protection (eight years) and Contaminated Land and Building Regulations
cover where applicable.
Q15. What, if anything, do you consider could or should, be removed from the
existing Code and why?
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5. How to respond
You can respond to this consultation either by email at:
consumercodesecretariat@gmail.com or by post addressed to: Secretariat,
Consumer Code for Home Builders, 35 St. Paul's Square, Birmingham B3 1QX.
If you have any questions about the consultation, please email them to Carol
Brady at consumercodesecretariat@gmail.com.
When they respond, representative groups are asked to give a summary of the
people and organisations they represent and where relevant, who else they
have consulted in reaching their conclusions.
Where we receive no response, we will take stakeholders’ views to be positive
and assume silence is an acceptance of any proposed revisions to the Code or
that no strong viewpoints are held.
6. Proposed consultation timetable:
Consultation launch
1 September 2015
Close of initial consultation
31 October 2015
Management Board consider responses and proposed
changes
December 2015
Management Board meet with Advisory Forum to review
January 2016
Further consultation on proposed changes
1 March 2016
Closure of consultation
30 April 2016
Management Board to consider responses and finalise
changes
May 2016
Announcement of changes
June 2016
Publication of changes on Code website and notification to
all registered home builders
July 2016
Implementation of changes to the Code.
February 2017
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All responses will be considered and feedback will be sought on any proposed
changes following the initial consultation prior to implementation.
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