March 1st 2024
Major housebuilders to be investigated over sharing price info
The UK competition watchdog has opened an investigation into eight housebuilders after it discovered they may be sharing commercially sensitive information.
In most instances sharing is sharing, however this current situation is an exception. The Competition and Markets Authority (CMA) launched the investigation against Barratt, Bellway, Bloor Homes, Persimmon, Redrow, Taylor Wimpey and Vistry, after it found evidence that suggested they were sharing non-public information, including sales princes and details of incentives for buyers.
The decision to launch the investigation came after a year-long market report by the watchdog into the barriers leading to the undersupply of new homes in the housebuilding sector.
Following this, the report said it had ‘fundamental concerns’ over the housebuilding market, pointing to the complex planning system and the limitations of speculative private development as the key reasons for not enough homes being built.
In addition, the report said various local planning departments were under-resourced or not have clear targets to deliver the number of homes needed in specific areas.
The CMA outlined profits of the 11 largest housebuilders were ‘generally higher than we would expect for a well-functioning market.’ However, it also warned that any measures introduced to tackle profitability in the sector would reduce the number of homes being built and exacerbate supply problems.
Commenting on the news, the Department for Levelling Up, Housing and Communities said: ‘We welcome the CMA’s final report following its full market study into housebuilding and the report will now be carefully considered.
‘Despite the economic challenges we remain on track to build one million homes this parliament, backed by £10bn investment in housing supply, while our long-term plan for housing will allow us to go even further to build the homes that local communities want and need.’
Moreover, a Bellway spokesperson – one of the organisations currently under fire – said: ‘We are reviewing the CMA’s report. Bellway has engaged and cooperated fully with the CMA throughout its market study – and will continue to do so.
‘Bellway is committed to exceptional customer care. We remain focused on the delivery of high-quality new homes that meet local demand and enhance the communities we build in as we work to increase the supply of UK housing.’
Image: Guilherme Cunha
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