Government Responds to CMA’s Housebuilding Study

The UK Government published its response to the Competition and Market Authority’s (CMA) housebuilding study.

This includes bringing forward a new consumer code for housebuilders and a New Homes Ombudsman service which will empower homeowners to challenge developers for any quality issues they face in their home. 

In response to the CMA’s recommendations, Housing and Planning Minister Matthew Pennycook said: “The Government has committed to delivering 1.5 million homes in this Parliament, including the biggest increase in social and affordable housing in a generation.

“The CMA was right to highlight areas for improvement in the housebuilding market. That is why we will empower homeowners to challenge developers over poor quality new homes and bad service, and we will consider the best way to address the injustice of ‘fleecehold’ private estates to bring unfair costs to an end.

“Alongside this, our updated National Planning Policy Framework and the reinstatement of mandatory housing targets for councils will ensure communities have the homes and necessary infrastructure to thrive.”

Sarah Cardell, CEO of the CMA, said: “We welcome the Government’s response to our recommendations on housebuilding, which we put forward to get people better protections and open the door to delivering more good quality homes.

“Housing is an essential area for consumers and driving economic growth, so we will assist Government as they take forward our solutions, alongside progressing our wider housing work.”

Background information:

• Earlier this year the CMA made 11 recommendations highlighting ongoing issues in the housebuilding market which the Government is working at pace to address. 
• Government has accepted the recommendations to bring forward a new consumer code for housebuilders and a New Homes Ombudsman service which will empower homeowners to rightly challenge developers for any quality issues they face in their home.  
• Other recommendations accepted in principle include greater protections for households living under private management arrangements. This would see homeowners receiving more information about what they are paying for as well as allowing them to challenge unfair costs at a tribunal.
• Government will implement measures to improve transparency as part of the Leasehold and Freehold Act 2024 and will also consult on further options to make sure estate managers can be properly challenged for the money they spend.
• This Government is also committing to provide robust guidance for residents’ management companies, so they have the support to effectively manage amenities on their housing estates, such as drainages and open spaces. This can include appointing a managing agent to oversee services.
• Several of the other recommendations will require further work and consultation to ensure the best policy solutions can be identified and enacted. This includes consulting on the best way to address the injustice of ‘fleecehold’ private estates.
• The CMA also proposed 11 additional options that include wider planning reforms. Many of these options are already being considered as part of the revised National Planning Policy Framework which will see mandatory housing targets for councils and low quality ‘grey belt’ released.
• This is on top of our Planning and Infrastructure Bill to modernise the planning system which will turbocharge housebuilding and accelerate the delivery of major infrastructure projects.