Responding to an online petition, the Government has said it recognises that there are issues with the quality of new homes and will endeavour to correct them.
Catriona Bright the managing director of New Build Inspection, said: "We welcome the fact that the Government recognises there is a problem, especially as the housebuilding industry is spending a fortune on professional lobbyists and public relation campaigns claiming their house is in order."
In its response the Government stated that contracts for the sale of new homes are not covered by the Sale of Goods Act. It claims that this is a fair reflection of the differences between buying goods and land, stating that the fundamental difference is that land is immovable.
Furthermore, it argues that in land transactions, consumers are more likely to be supported by independent professional advice and the terms of the contract are more likely to be negotiated.
However Bright does not agree, adding: "New build buyers have no scope to negotiate the terms of the contract when buying a new home. They simply refuse - it is misleading to imply that this is possible. Moreover, the distinction between land and goods is not helpful as the problem is with the actual building on the land not the land itself. If I spent a couple of thousand pounds having a new bathroom fitted it would be covered by the Good and Services Act - it is scandalous that new build homes are not."
The Government goes on to say that the Office of Fair Trading (OFT) is carrying out a market study into the house building industry which will report back in Summer 2008.
The stated outcomes of the study could include:
- enforcement action by the OFT
- a referral of the market to the Competition Commission
- recommendations for changes in laws and regulations
- recommendations to regulators, self-regulatory bodies and others to consider changes to their rules
- campaigns to promote consumer education and awareness
- a clean bill of health.
