New Combined Building Agreement / Contract for Sale 2026

Introduction

Until the beginning of this year, the agreements for the sale of a new dwelling in a residential estate were typically in two different formats.  

The Solicitor for the developer could issue a contract for the sale of the land incorporating the Law Society’s General Conditions of Sale, alongside a separate building agreement to govern the construction of the property, which incorporated the Building Conditions jointly issued by the Law Society and the Construction Industry Federation. 

Alternately and more commonly, a Combined Building Agreement / Contract for Sale would issue which would also incorporate the General Conditions of Sale and the Building Conditions.

General Conditions of Sale

The General Conditions of Sale have been updated regularly over the years, most recently in 2023, but the Building Conditions had not been updated since 2001. This resulted in a number of inconsistencies and anomalies between the two sets of conditions with regard to deposits, completion notices, insolvency, dispute resolution, forfeiture and even notice requirements which accordingly required additional special conditions in the contract of sale to resolve.

New Combined Building Agreement / Contract for Sale

On 6 January 2026, the Law Society introduced a new Combined Building Agreement / Contract for Sale which includes a new set of Building Conditions which have been agreed with the Construction Industry Federation to replace the conditions of the 2001 Building Conditions for the construction of new dwellings in residential estates. The new Building Conditions reflect the changes in law and in legal and construction practices and technology since 2001. They also reflect the current legislative framework surrounding new homes construction including GDPR, the introduction of the Building Control Management System introduced as part of the wider Building Control (Amendment) Regulations 2014 and the impact of the Multi-Unit Developments Act 2011.

Significant Changes

The new 2026 Conditions contain a number of significant practical changes to those set out in the previous 2001 Conditions, including:

Completion Period and Extensions

The 2001 Conditions did not prescribe any length of time for the construction of the property.

The 2026 Conditions provide for an 18-month period for the works to be carried out with extensions expressly permitted for Force Majeure (which includes cyber-attack, strikes and labour disputes and global health emergencies and pandemic outbreaks) as well as for Utility Delay. Utility Delay is broadly defined but essentially is any act, omission or delay in providing access or a connection to any infrastructure which is required to complete the construction of the property.

Defects Liability Period

Where a Latent Defects Insurance policy, such as HomeBond, was in place, the 2001 Conditions provided for an 18-month defects liability period for major defects and a six-month defects liability period for minor defects, subject to a standard list of exclusions.

The 2026 Conditions impose an obligation on the Vendor to have a Latent Defects Insurance policy in place (which is not onerous as it would be standard in most developments and a pre-condition to drawdown for most residential mortgages).

The 2026 Conditions also remove the distinction between minor and major defects for defect liability purposes, providing for a 12-month defect liability period for all defects which arise in respect of the works. The list of exclusions for defects has also been amended and extended.

Dispute Resolution

Any disputes under the 2001 Conditions were to be referred to arbitration save for disputes as to whether a defect was major or minor which would be determined by an expert. Under the 2026 Conditions, all disputes about the Works are to be referred to an expert with a separate set of provisions regarding the appointment of an expert for disputes relating to the existence of a defect and whether the defect is major or minor for the purposes of agreeing a closing date.

Sub-Contracting

The 2001 Conditions provided that the Vendor would not be able to sub-contract the entire works to any third party without the prior written consent of the Purchaser. The 2026 Conditions now provides that the Vendor can sub-contract some or all of the Works to a third party without requiring consent.

Implementation

The Law Society have indicated that the Combined Building Agreement / Contract for Sale 2026 is intended for use in residential estates only and is not to be used for one off units or single builds. The 2001 Conditions, suitably adapted, should continue to be used for these developments though one would hope that updated Building Conditions for these types of builds are on their way.

The Law Society have also advised that the Combined Building Agreement / Contract for Sale 2026 should be used for all new homes in residential developments from 1 February 2026 but are encouraging parties to introduce it before then if possible. They caveat this by advising that the 2026 Conditions need not be used for any new phase in an existing development, nor in any development where sales have commenced before 1 February 2026 and contracts have already issued using the 2001 Conditions.

Conclusion

The introduction of the Combined Building Agreement / Contract for Sale 2026 and the new Building Conditions in particular is long overdue but very welcome. While the majority of changes which the Law Society have made to the Building Conditions would already have been made and applied in practice by most Solicitors acting for major developers, the introduction of a Law Society approved Combined Building Agreement / Contract for Sale gives the opportunity to reduce pre-contract enquiries and speed up the negotiation of contracts for both the Vendor and the Purchaser by standardising the contract documentation.

It is to be hoped that this template will be promptly adopted across the new homes market and with as little variation as possible. An update to the Building Conditions for use with one-off developments would also be very welcome.

Further Information

For further details about the New Combined Building Agreement / Contract for Sale 2026 or any Property matter, please contact Partner Paul McCutcheon or a member of our Property Team.