Row of new-build homes
Row of new-build homes

If you have been following my campaign to increase consumer protections for buyers of new build homes, you will be aware of the appalling cases of people moving into new houses only to find large numbers of defects which developers have been extremely slow to resolve. In my own constituency, residents moving into a new Persimmon homes in Woodsend contacted me about a litany of problems with their homes compounded by Persimmon’s shoddy customer service and failure to take responsibility for getting problems resolved.  Persimmon’s profits were boosted to over £1bn last year, helped by the funding they receive from the government (in other words from taxpayers’ money) through the Help to Buy scheme. I have heard similar stories from owners of new homes across the UK, leading me to conclude that these problems are endemic throughout the housebuilding industry.

In my debate in parliament in December, I called for the Government to introduce a series of measures to consumer protections for people buying new build homes. One of these measures is a so-called “snagging retention” which would allow new-build homebuyers to retain a percentage of the cost of the house, which would be held back for six months, when it would be paid over only if any defects have been corrected.

So I welcome the news that Persimmon Homes have today announced a scheme which will allow buyers to hold back 1.5% of the property value until problems are fixed. The retention is due to be written into contracts from the end of June this year and will hopefully mean that Persimmon acts more quickly in future to resolve problems.

However, Persimmon’s plans do not go far enough. The percentage retained is just 1.5%, lower than the 2.5% recommended by consumer rights organisation the HomeOwners Alliance. Moreover, it only applies to faults identified “at the point of key release” – but you might not notive a defect until you’ve moved and settled in to your home.  And of course, this measure only applies to future sales so does not help people who already own their homes, or those buying from other developers aside from Persimmon (although I hope others will follow suit).

So whilst I welcome any measures which encourage companies like Persimmon to clean up their act, the Government must go much further improve regulation across the homebuilding industry. Buying a home is the largest, most important purchase many of us will ever make. It’s high time for proper consumer protection.

 

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