I’ve just been reminded that the ratings will be done independently by the credit ratings firm Equifax, not by Fair Trading.
Also, Fair Trading’s view clearly is that market pressure will be at least as effective as compulsion. Once all the good developers are rated, an unrated developer will be viewed the same as a developer who applied for a rating and failed. That should not only be a red flag to consumers but will attract additional scrutiny from the regulator.
As we heard at the seminar, having a rating could become a condition of bank lending and development approval. The developers will then be under a lot of pressure to apply for a rating, otherwise they are signalling that they are not up to scratch.