New legislation being considered by the Government would allow buyers of new-build homes to withhold as much as 5% of the price of the property for up to six months.

The scheme, being considered by housing and communities secretary James Brokenshire, would allow purchasers to withhold payments on ‘shoddy’ new build properties, until all repairs have been completed. The final payment would only be made after the buyer was satisfied that all faults on the property had been repaired.

Nyree Applegarth, a property litigation expert and partner at law firm Higgs & Sons, said:

“The proposal echoes an existing policy which already operates in the Netherlands where the buyer’s solicitor retains a percentage of the purchase price for up to six months after completion and then hands over the final payment once all issues have been remedied.

“If the scheme is introduced, it will reflect the commercial property sector where it is common place for a buyer to hold back a proportion of the total sum due until all problems have been resolved.

“Given that the guarantee offered by organisations such as the NHBC does not offer purchasers a quick solution in the event of a clear defect in the property, this is a welcome proposal for any new home purchaser.”