Shoddy work, dull design, high prices, dreary surroundings and isolation from transport and services. That roughly sums up the output of Britain’s housebuilding industry. It’s hardly a new observation, but coming in a report from Sarah Cardell, the feisty CEO of the Competition and Markets Authority (CMA), it may have more impact than the many others from the past.

This week’s headlines were all about possible collusion between the big builders, in breach of the competition rules, but the real problems in this vital industry go far deeper. Collusion may be the least of them. There might indeed be unlawful agreements about how much to bid for a piece of building land, but anyone can view the plans and find out proposed prices for the homes. Perhaps the most dispiriting finding from the CMA has nothing to do with this at all.

The practice of Estate Management Agreements, where the local authority puts a third party in charge of maintaining public areas and amenities (if any) is shocking. It looks like the industry’s answer to the ban on the egregious practice of escalating ground rents on houses. The scope for abuse of captive householders is obvious in both cases.

Successive governments have helped make things worse. Help To Buy looked to many of us at the time to be a demand-led attempt to solve a supply-led problem, and so it has proved. The scheme allowed the housebuilder to double his margins by charging those on HTB a premium to other buyers. We dubbed it Help To Buy Builders’ Yachts.

The cost of that stupid idea is only now starting to become apparent. Yet it almost looks like a sensible policy when set against the recent suggestion of a government-backed 99 per cent mortgage. We can only hope this terrible idea dies quietly before the Budget unleashes it on unsuspecting first-time buyers.

The CMA report puts much blame on the complex, sclerotic planning system, onto which parliament has added a whole raft of well-intentioned green obligations. The big housebuilders can cope with the increased bureaucracy and the inevitable delays – the relatively innocent reason why they have land banks – but the rules are savage for small housebuilders.

Combined with the prudential lending rules that oblige the banks to charge near-usurious interest rates for commercial loans, it is no surprise that the local house-builder infilling small spaces is an endangered species. 

The CMA report has plenty of suggestions to speed things up and make the current house-building targets look plausible, but we have been here many times before, and the Nimbys have triumphed nearly every time. (For a slightly-related demonstration of Nimby power, see here).

Mind you, given the quality of many new housing estates, and the near-universal assumption that every homeowner will have at least one car, the resistance is understandable. 

The CMA is investigating the allegations of collusion among the builders. Perhaps a look into whether there is an effective oligopoly in the industry is overdue. Building houses is about more than industrial economies of scale. Britain has some of the world’s finest architects. New developments could enhance, not detract, from their environment. Is it really not possible to do this?

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