UK housebuilders face CMA probe over info sharing, home quality

(Sharecast News) - Britain's competition watchdog has started an investigation into eight housebuilders over evidence they may have been sharing information which could be harming competition in the sector. In a major report released on Monday, the Competition and Markets Authority said it had "fundamental concerns" with the operation of the housing market, revolving around the planning system, estate management charges and the quality of new housing.

Companies being investigated are Barratt, Bellway, Berkeley, Bloor Homes, Persimmon, Redrow, Taylor Wimpey, and Vistry.

The CMA said information sharing could influence the build-out of sites and the prices of new homes and weaken competition in the housing market.

It added that it had "substantial concerns" about estate management charges - where homeowners face high and unclear charges for the management of facilities such as roads, drainage, and green spaces.

The monopolies watchdog says it has "fundamental concerns" with the housebuilding market, claiming 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".

Britain's reliance on speculative private development had led to a widening gap between what the market will deliver and what communities need, the CMA said, with developers producing 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".

Reporting by Frank Prenesti for Sharecast.com