CMA considering Gove’s call for recommendations to improve “effectiveness” of housebuilding industry 

The Competition & Markets Authority could launch a study of the housebuilding sector in January following a formal request from Michael Gove. 


The watchdog’s interim chief executive Sarah Cardell, in a letter replying to the housing secretary, said the body has been working on proposals to look at the industry, including a one-year study, and could put it before its board in January.

This follows Michael Gove calling repeatedly for the CMA to study the sector. Gove last March accused housebuilders of operating like a “cartel”, 

Gove wrote to Cardell last month to say it is “critical that we have a housebuilding sector that operates effectively to deliver the homes that people need”.

He said: “The last housebuilding market study took place 14 years ago and since then, there have been significant changes in both the market and the challenges facing the country as a whole – such as net zero, changes to the structure of the market following the financial crisis and changing demographic trends.”

He said the government would welcome policy recommendations from the CMA “to make sure the housing market is operating effectively.”

The housing secretary also wrote to the CMA in May saying that he was interested in the barriers facing SMEs who want to enter the market or expand “including the role that the land market and planning system play in these dynamics, and whether the market structure is holding back innovation.”

Gove’s call for CMA intervention follows his comments last year that the housebuilding industry operates “essentially” as a “cartel”, a statement that prompted the Home Builders Federation to hit back in response.

>>See also: Making SME house builders great again

>>See also: Gove to water down local housing targets following backbench pressure

Cardell said the government’s openness to recommendations regarding the housebuilding industry will be “an important factor” in the board’s consideration of proposals for a market study.

She added: “One of the requirements for delivering the homes people need is a thriving, competitive housebuilding sector.

“With this in mind, CMA staff have been developing proposals for work in this area, including a possible market study for the board’s consideration in January.

“As we discussed, a market study would be a substantial piece of work, and it is crucial that careful consideration is given to its scope, to ensure suitable focus and efficiency. “

A Fair Deal for Housing campaign 

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Housing Today believes the government should not back away from its manifesto pledge of building 300,000 new homes a year by the middle of the decade. We badly need more homes and a lack of supply is a major factor in creating problems of affordability for both buyers and renters.

Over the next few months, Housing Today  will be exploring potential solutions to help us ramp up housebuilding to 300,000. These are likely to, include different ways of working, funding asks of government and policy ideas that could boost housebuilding.

We want to hear from you: what do you think can make a difference at a policy level?

What can the industry do better?

We believe that, with the right commitments from ministers and the industry, it is possible to build more homes and help the government to meet its objectives to “build beautiful”, improve quality and safety, boost home ownership and level up the UK.

Click here to find out more about the campaign

To contribute ideas to our A Fair Deal for Housing Ideas Zone database, click here.