The housebuilding sector needs ‘significant intervention’ to deliver enough homes in the right places.
In a report published today, the Competition and Markets Authority also revealed that eight of Britain’s biggest housebuilders are under investigation for suspected illegal information-sharing.
The CMA has therefore launched an investigation under the Competition Act 1998 into Barratt, Bellway, Berkeley, Bloor Homes, Persimmon, Redrow, Taylor Wimpey, and Vistry
The Planning system and the limitations of speculative private development have seen too few homes built they say
The study also found substantial concerns about estate management charges – with homeowners often facing high and unclear charges for the management of facilities such as roads, drainage, and green spaces.
Concerns have been found, too, with the quality of some new housing after the number of owners reporting snagging issues increased over the last 10 years.
Around two-fifths of the homes built between 2021 to 2022 were delivered by the largest, national housebuilders while more than 50,000 homes were delivered by thousands of smaller, regional builders.
Their report found that the planning systems are producing unpredictable results and often take a protracted amount of time for builders to navigate before construction can start.
The report highlights that many planning departments are under resourced, some do not have up to date local plans, and don’t have clear targets or strong incentives to deliver the numbers of homes needed in their area.
They are also required to consult with a wide range of statutory stakeholders – these groups often holding up projects by submitting holding responses or late feedback to consultations on proposed developments.
Another significant reason behind under delivery of homes are the limitations of private speculative development.
The evidence shows that private developers produce houses at a rate at which they can be sold without needing to reduce their prices, rather than diversifying the types and numbers of homes they build to meet the needs of different communities (for example providing more affordable housing)
Sarah Cardell, Chief Executive of the CMA, said:
Housebuilding in Great Britain needs significant intervention so that enough good quality homes are delivered in the places that people need them.
Our report – which follows a year-long study – is recommending a streamlining of the planning system and increased consumer protections. If implemented, we would expect to see many more homes built each year, helping make homes more affordable. We would also expect to see fewer people paying estate management charges on new estates and the quality of new homes to increase. But even then, further action may be required to deliver the number of homes Great Britain needs in the places it needs them.
