The Competition and Markets Authority (CMA) has published its final report on the housebuilding market in Great Britain – finding that the complex and unpredictable planning system, together with the limitations of speculative private development, is responsible for the persistent under delivery of new homes.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.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.The CMA has also today opened a new investigation into the suspected sharing of commercially sensitive information by housebuilders which could be influencing the build-out of sites and the prices of new homes. While this issue is not one of the main drivers of the problems we’ve highlighted in our report, it is important we tackle anti-competitive behaviour if we find it.There are persistent shortfalls in the number of homes built across England, Scotland, and Wales, with less than 250,000 built last year across Great Britain – well below the 300,000-target for England alone.The report identified a wide range of different types of housebuilders operating in the market:&nbsp; 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.Around 60% of all houses built in 2021 to 2022 were delivered by speculative private development, which is when builders obtain land, secure planning permission, and construct homes without knowing in advance who will buy them or for how much. This way of building homes has given builders flexibility to respond to changes in the market. However, the country’s reliance on this model has seen the gap widen considerably between what the market will deliver and what communities need.The report found that this speculative approach to building, coupled with complex and unpredictable planning rules across the three nations, has been responsible for the persistent under delivery of homes:The CMA found evidence during the study which indicated some housebuilders may be sharing commercially sensitive information with their competitors, which could be influencing the build-out of sites and the prices of new homes. &nbsp;While the CMA does not consider such sharing of information to be one of the main factors in the persistent under-delivery of homes, the CMA is concerned that it may weaken competition in the market.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 CMA has not reached any conclusions at this stage as to whether or not competition law has been infringed.More information can be found via the CMA’s <a href="https://www.gov.uk/cma-cases/investigation-into-suspected-anti-competitive-conduct-by-housebuilders" class="govuk-link">housebuilding investigation case page</a>.The CMA believes a substantial intervention in the housebuilding market is necessary to address the issues its market study has identified.The CMA would like to see a housebuilding market that delivers:The CMA is making recommendations to governments in those areas where it sees opportunities to improve market outcomes without significant trade-offs with other policy objectives. These include:Given the wider policy trade-offs and complexities that are inherent in the design and operation of the planning system, the CMA does not consider it appropriate to make specific recommendations to governments in this report about how those trade-offs should be made. However, given the vital role that the planning systems play in shaping market outcomes, the report sets out proposed options for consideration. These include:While the recommendations and options above will significantly improve outcomes for homeowners and the housebuilding market, the evidence shows that the market may still not deliver the quantity of homes that meets Great Britain’s housing need.It is open to policymakers to deliver change through more fundamental interventions, often with fiscal and policy implications, that go beyond the way in which the market itself works but would have a significant impact on the quality and affordability of new homes being built. While it is not for the CMA to offer recommendations or specific policy proposals in this space now, the report sets out areas of potential intervention. &nbsp;These interventions would include a significant increase in non-speculative house building that has previously been led by local councils and housing associations.More information – including the full final report – can be found via the CMA’s <a href="https://www.gov.uk/cma-cases/housebuilding-market-study" class="govuk-link">housebuilding market study case page</a>.&nbsp;

CMA's Findings on Housebuilding Market

The Competition and Markets Authority (CMA) has identified fundamental issues in the housebuilding market in Great Britain, including the under-delivery of new homes due to a complex planning system and speculative private development. Concerns also arise from high estate management charges and potential anti-competitive behavior among housebuilders. The CMA has launched an investigation into the suspected sharing of commercially sensitive information by major housebuilders, such as Barratt, Bellway, Berkeley, and others, under the Competition Act 1998. The report recommends streamlining the planning system, increasing consumer protections, and potentially implementing more fundamental interventions to address the housing shortage in Great Britain.

CMA's Findings on Housebuilding Market

The CMA's final report on the housebuilding market in Great Britain highlights concerns about under-delivery of new homes, estate management charges, and potential anti-competitive behavior among housebuilders.