Competition Regulator Investigates U.K. Housebuilders

Investigation Details

The CMA clarified that the investigation is ongoing, and no definitive conclusions regarding any breaches of competition law have been made yet. While the CMA acknowledges that information sharing might not be the primary cause of the consistent shortfall in house deliveries, it is concerned about its potential impact on market competition.

CMA Findings

The inquiry stems from a recent CMA report that highlighted speculative private development as a key contributor to the prolonged housing shortage. This type of development involves building homes without predefined buyers or pricing, accounting for approximately 60% of all houses constructed from 2021 to 2022.

Private Developers and Affordable Housing

The latest findings indicate that private developers are constructing houses at a pace aligned with market demand, rather than focusing on the diversity of homes required to accommodate various communities. This suggests a lack of emphasis on providing more affordable housing options.

Challenges in Planning Systems

Recommendations for Improvement

To address these issues, the CMA proposed several recommendations, including enhancing consumer protections for homeowners, incorporating amenities into all new housing developments, and establishing a new homes ombudsman with a unified consumer code to drive better market results.

Industry Response

Leading developers such as Taylor Wimpey have pledged full cooperation with the CMA's investigation and have welcomed the suggested changes, particularly regarding the planning process. Similarly, Redrow has committed to collaborating with the CMA to address ongoing concerns.

Bellway is currently reviewing the report and plans to work closely with the CMA as it has done previously. However, Berkeley Group opted not to comment on the matter.

On the other hand, Vistry Group, Persimmon, Bloor Homes, and Barratt Developments did not provide responses to requests for comments.