CMA to study competition and land banks in housebuilder investigation

The Competition and Markets Authority (CMA) has outlined the main areas of the housebuilding market it is investigating to ensure developers are serving consumers in the best way possible.

After launching the market study back in February, the CMA received feedback from housebuilders across England, Scotland and Wales, as well as campaign groups, councils and other industry stakeholders.

In a statement on Friday, the competition regulator said it has now identified five areas to look into in greater detail:

• estate management charges (when homeowners have to pay private companies to maintain roads, parks and street lighting);
• land banks (whether the size of some builders' portfolios is limiting competition or slowing building in some areas);
• planning rules (if complex planning rules were holding back the delivery of new homes);
• competition between builders (how markets operate when large builders compete against smaller, regional firms);
• barriers for new businesses wanting to build homes (looking into the issues smaller builders face when developing new home, like access to land).

"The CMA will investigate each of these issues further – while considering the economic conditions affecting the sector – and will provide updates on its work later in the autumn," the statement said. "The CMA will then consider a range of options to best address the issues it has identified, which could include recommending legislative changes to the UK, Scottish and Welsh governments, or launching a market investigation."

The CMA is also investigating the private rental sector on concerns that a significant minority of landlords and letting agents may not be following consumer protection rules.

Sarah Cardell, the CMA's chief executive, said: “The CMA alone can’t resolve the problems in the UK housing market. But we have a role to play and will do our part to help ensure the private rental and housebuilding markets work better for people and businesses.