The rise in new build defects and disputes
New build disputes are becoming increasingly common. We regularly receive calls from buyers who feel aggrieved when builders fail to deliver on their promises. Buying a new build property should be an exciting moment in your life, but for many it has turned into a nightmare of frustration, disappointment and worry.
It seems that once a builder has taken your money the company loses interest. Concerns about defects and snags go ignored as the builder concentrates on its next development, leaving buyers without adequate redress.
Many people suffer in silence. Others attempt to make sense of the confusing landscape of consumer codes and warranties, but remain unable to force the builder to address their concerns.
the problem of new build defects and disputes has been recognised is Parliament, with MPs calling for government to set up a special independent ombudsman service to deal with it.
This follows high profile publicity about the quality of homes being built by major developers such as Bovis. And in a recent survey of new home buyers an astonishing 98% reported experiencing defects or snags.
Ineffective consumer codes
There are consumer codes in place, but these are inadequate. The All Party Parliamentary Group was critical of the various codes and the lack of obligations placed on home builders. This is, they say, a reflection of the imbalance of power between builders and consumers. The consumer codes seem to have been formulated so as to restrict, limit and contain complaints. The language used in the codes is according to one observer, ‘the language of exclusion’.
Consumer codes and complaints processes are particularly unsuitable for defects that might be termed ‘snags’. This has resulted in a significant gap in consumer redress, with the average award in 2016 being less than £1,000.
So what can frustrated new build buyers do?
One option is to take legal action.
However, if the financial value of the case (which is what we have to concentrate on) is less than £10,000 then even if the case is won, there is no entitlement to recover legal costs. This is because disputes with a value of under £10,000 are referred to the so called ‘small claims court’ which does not allow legal costs to be recovered.
So while solicitors may be able to help, the costs of doing so could make the proposition of fully contested court proceedings uneconomic for most new build buyers.