New-Build homes – dealing with London’s housing crisis
You’re probably familiar with newspaper headlines reporting the lack of housing, particularly in London. The government plans to deliver an average of 300,000 homes annually by the mid-2020s, with a number of these homes to be built in London.
January 2018 saw the launch of the rebranded Homes England by the then Housing Secretary Sajid Javid, seen as one of the “…key steps towards delivering the homes the country needs.”
One of the main roles of Homes England (the “Agency”) is to secure land for building including on brownfield sites. This is particularly relevant to London, where there is a shortage of land available to build on. Hundreds of local authorities have published brownfield registers showing developable land. The Agency are able to use these registers while assessing the demand the homes in the area to progress brownfield development. For instance, this had led to the development of 10,000 new homes on a brownfield site northwest of Cambridge.
New-build properties are particularly attractive for first time buyers through the Government’s Help to Buy schemes. There are a number of ongoing new build projects in the capital, such as the London Square Streatham Hill, the Wandsworth Exchange and the large Nine Elms development. Developers/ builders will often buy a large area of land, subdivide it and start building homes and infrastructure such as roads and sewers on these plots.
Some of the largest developers include Persimmon PLC, Taylor Wimpey PLC and Barratt Developments PLC. However, the Agency is also supporting smaller house builders into the market to speed up construction. They have already dedicated £750 million of the Home Building Fund to small and medium-sized enterprises, custom builders and developers using modern construction techniques.
However, in an effort to build much needed homes quickly, there is a risk that quality will suffer. Typically, these homes may be completed in stages and sold before they are built, or even before building work has begun. You may have bought off-plan or purchased ‘second hand’, i.e. buying a recently constructed house or flat. Alternatively, you may have a shared ownership lease when you bought a new-build flat.
For a number of people that purchase new-build properties, there will be no issues with their property. For some, they may find that there are some minor cosmetic works outstanding, such as a badly painted room. Generally, in this situation, the developer has a reasonable time to remedy the issue. There will usually be a provision relating to this in your contract. “Reasonable time” comes down to fact and degree, depending on this issue.
However, for some others, the excitement of moving into their new home is dampened when they are met by water leaks, missing insulation, ill-fitting windows or poor drainage issues and other more serious defects. Not quite the show house!
Issues such as these will be discussed further in an upcoming blog.
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