The monopolies watchdog accused eight of the UK’s top housebuilders of “sharing commercially sensitive information with their competitors” today, in a damning report on the country’s residential construction sector.
The Competition and Markets Authority (CMA) said it had seen evidence that eight housebuilders were sharing evidence on sales prices, incentives, and rates of sale. It said sharing this information “potentially could influence” the amount a developer would bid to buy land to build on, or sale prices for homes.
The companies in question are Barratt, Bellway, Berkeley, Bloor Homes, Persimmon, Redrow, Taylor Wimpey, and Vistry.
The CMA said it did not consider the information sharing to be one of the main factors in the UK’s persistent under-supply of homes, but added that it “may weaken competition”.
The country’s poor supply of new housing had been the main focus of the watchdog’s review. It noted that the total number of homes built across all of Great Britain annually was about 250,000, well short of the Government’s target of 300,000 new homes in England alone.
The watchdog found that the UK’s “complex planning system” and reliance on speculative private development together had led to an under-delivery of new homes.
It said the English, Scottish and Welsh planning systems “are producing unpredictable results and often take a protracted amount of time for builders to navigate before construction can start”.
The report added that the requirement to consult with a number of “statutory stakeholders” - such as Natural England or Historic England - also creates challenges.
The CMA said “these groups often hold up projects by submitting holding responses or late feedback to consultations on proposed developments”.
Another reason for the under supply, it said, was that builders would typically provide homes more slowly than they could build them. It claimed that they would build at a pace that would prevent them from needing to reduce prices instead of the fastest possible pace.
A spokesperson for the Home Builders Federation said: “The CMA report recognises the challenges the industry faces when looking to deliver homes.
“We welcome recognition that the planning system is a fundamental barrier to delivery and adds unnecessary delay and cost into the development process, and the need for local authorities to have plans in place and properly resourced planning departments.
“We are committed to working with the CMA and Government to introduce their recommendations and ensuring we can create an environment within which we can deliver the homes the country needs.”
A Bellway spokesperson said: “We are reviewing the CMA’s report. Bellway has engaged and co-operated fully with the CMA throughout its market study - and will continue to do so.”
A Redrow spokesperson said: ““Redrow has fully co-operated with the CMA throughout its market study. We remain focused on the delivery of high-quality and much-needed new homes as part of our work to create thriving communities across England and Wales. We will continue to work with the CMA.”
A spokesperson from Bloor Homes, said: “We have been transparent with the CMA throughout the year-long study and are currently reviewing the findings. We will continue to work with them throughout the course of the investigation.”
A Vistry spokesperson declined to comment. Barratt, Berkeley, Persimmon, and Taylor Wimpey did not respond to a request for comment, nor did Natural England or Historic England.
