UK’s largest housebuilders are facing a competition probe into how much land they control, their maintenance charges on housing estates, the lack of competition in the sector, and the barriers to entry.
Competition regulator, the CMA, said the investigation follows a six-month study into the pace of building new homes in Britain.
Sarah Cardell, the CMA’s chief executive, said the probe would be to get to the “bottom of any potential competition concerns”.
“Once complete, we will consider what actions the CMA can take to tackle any concerns identified or whether there are more effective ways to deal with those concerns such as through recommendations to government for legislative change.”
Shares in sector leaders Barratt Developments, Taylor Wimpey, and Persimmon held steady, but have endured a tough year with higher mortgage rates seeing orders shrink in recent months.
In particular, the CMA said it was concerned about the large amount of developable land controlled by the biggest housebuilders and any competition implications this might have.
In the same announcement, the CMA also said it was taking action about the rental market where there are clear signs that a significant minority of letting agents and landlords are not following consumer protection rules.
“For private renters, we’re taking action to provide updated guidance for lettings agents so that both tenants and landlords are really clear about their own rights and responsibilities.
“We’ve also identified areas of concern relating to zero deposit schemes, sham licences, onerous guarantee clauses, and possible unlawful discrimination.
“These warrant further investigation and we stand ready to take enforcement action if needed.”