Seven housebuilders have agreed to contribute a total of £100m for UK housing programmes, after the Competition and Markets Authority (CMA) have completed its investigation
The CMA housing investigation was launched last year following suspicions that seven housebuilding companies were exchanging details.
Barratt Redrow, Bellway, Berkeley Group, Bloor Homes, Persimmon, Taylor Wimpey, and Vistry were all investigated for discussing sales pricing, the number of property viewings, and buyer incentives on offer.
Largest contribution secured through a CMA affordable housing probe
To smooth concerns, these companies have offered legally binding commitments to prevent anticompetitive behaviour and ensure compliance.
The packages include a combined payment of £100m to be split between affordable housing programmes, working with the Home Builders Federation and Homes for Scotland to develop industry guidance on information sharing, and agreements not to share certain types of information with other housebuilders, such as sales prices.
If accepted, which is the likely outcome, the CMA will no longer be required to determine whether these companies have breached competition law, resulting in a more streamlined conclusion to the investigation.
The money would be the largest contribution secured through a CMA affordable housing probe or any other investigation. It would directly support the delivery of affordable housing throughout the UK, prioritising low-income households, first-time buyers, and other vulnerable people.
“Housebuilders are taking clear and comprehensive steps to ensure they comply with the law”
Sarah Cardell, chief executive at the CMA, said: “Housing is a critical sector for the UK economy and housing costs are a substantial part of people’s monthly spend, so it’s essential that competition works well. This keeps prices as low as possible and increases choice.
“As a result of the CMA’s investigation, housebuilders are taking clear and comprehensive steps to ensure they comply with the law and don’t share competitively sensitive information with their rivals.
“Alongside these measures, the housebuilders we investigated have agreed to pay £100 million towards affordable homes programmes, which will help communities up and down the country.”
This is not the first time Barratt-Redrow has had to prove itself to the CMA. When the two housebuilders merged last year, the CMA requested proof that the combined company would not cause a loss of competition in the areas where they operate throughout Shropshire, under threat of further investigation.
However, the issues were resolved, and the merger saw Barratt-Redrow become the biggest housebuilding company in the UK.
At the time, A Barratt spokesperson said that waiving the CMA condition: “removes uncertainty for the employees, supply chain and wider stakeholder groups of both businesses, and allows us to accelerate the creation of an exceptional UK homebuilder in terms of quality, service and sustainability, which in turn can accelerate the delivery of high-quality, sustainable homes and communities for customers across the UK, addressing the country’s need for homes.”
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