Warranty providers move towards shared MMC assessment standard

Housing leaders have agreed a key step towards insuring and mortgaging new homes built using modern methods of construction (MMC), the housing minister Christopher Pincher has announced.

Warranty providers have signed a Memorandum of Understanding (MoU) agreeing to take steps towards having a shared minimum assessment standard for homes built using MMC.

Having this standard will help assure lenders and insurers of the quality and durability of MMC homes, making mortgage and insurance products more available for them.

MMC comprise new house building techniques where homes can be manufactured offsite and assembled onsite, allowing homes to be built much more quickly than through traditional house building methods.

Industry research suggests that homes built using MMC can have up to 80% fewer defects and could reduce heating bills by up to 70%.

Pincher said: “Building green, well-designed homes is at the heart of this government’s mission to support people in every part of the country.

“We’re bringing together the talents of our manufacturing and financial industries to back new technologies that could see us leading the world in the design of high-quality, low-carbon homes with the mortgage and insurance products needed to support them.”

The parties involved in the MoU are the National House Building Council (NHBC), BLP, and MDWIS on behalf of Premier Guarantee and LABC Warranty, making up a significant majority of the UK’s new build home warranty market.

Warranty providers currently use different standards for their assessment of homes, making it hard to know which defects homes have been tested for.

The government have called the announcement an ‘important step’ towards standardising warranty providers’ assessments of homes built using MMC.

The move has made possible by the MMC Working Group, which was convened by government to help boost the number of MMC homes. The working group includes representatives of Buildoffsite, Homes England, the NHBC, and the Royal Institute of Chartered Surveyors.

Mark Farmer, MMC Working Group chair and government MMC Champion, said: “This MoU is an important milestone in improving underwriting confidence in modern methods of construction.

“Greater collaboration and transparency in technical assessment and validation across the market will ensure we have consistency of approach and can drive a more unified quality and standards led approach to innovation. I would like to thank everyone that has been part of the complex journey of arriving at this agreement.”

Steve Wood, chief executive of NHBC, said: “NHBC welcomes all steps that contribute to improving the construction quality of new homes. We are wholly committed to building confidence in MMC and believe that it has an important role in helping the industry and government to deliver safe, sustainable places to live over the long-term.”

The government has repeatedly expressed its support for MMC which it sees as a potential way to solve the country’s housing crisis.

So far, the government has delivered over £272 million of loans for projects using MMC from its Home Building Fund. It has also launched an agreed definition and categorisation for all MMC.

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