Vol. 560 No. 1
877 Mr. Coveney asked the Minister for the Environment and Local Government if he will make a statement on the practice of home builders in certain areas to demand that purchasers, who are frequently buying their first home, pay sometimes in excess of 90% of the purchase price by stage payments in advance of the completion of the house; and when he expects to introduce legislation to outlaw this undesirable and oppressive practice. [1052/03]
The Office of the Director of Consumer Affairs took a case to the High Court in 2001 under the European Communities (Unfair Terms in Consumer Contracts) Regulations, 1995, and with the support of my Department. The subsequent High Court Order, December 2001, prohibited the use of 15 "unfair" terms in house building contracts and also prohibited stage payments in house building contracts, which exceed the percentages stipulated in the Irish Home Builders Association, IHBA, code of practice or which exceed "the extent and value of works carried out at the date specified for the payment in question".
The IHBA code of practice stipulates that in the case of a purchaser who obtains the title to the site prior to the completion of the transaction, three distinct stage payments may be required, namely at joist level, i.e. 25%; at roof level, i.e. 25%; and at internal plastering stage, i.e. 25%, in addition to a booking deposit, 4%; contract deposit, 11%; and completion payment, 10%. Site costs are the subject of a separate contract.
The IHBA code of practice may be accessed on the Construction Industry Federation website at www.cif.ie.
