Insurance News Archive

OFT to investigate UK housing market

The house construction industry is to come under the scrutiny of the Office of Fair Trading (OFT) to ensure that buyers are getting a fair deal on the supply and standard of new homes.

Issues such as the level of competitions in the £20 billion industry will be monitored to keep tabs on whether the sector is "working well" for homebuyers.

John Fingleton, the OFT's chief executive, said: "This is a hugely important market for the economy because of its substantial economic impact and because unresponsive housing supply hinders labour mobility, constrains economic growth and harms consumers."

He explained that the importance of scrutinising the sector was heightened further due to the "very high detriment" for a house buyer even if there is just "low levels of dissatisfaction" with their property.

The study will focus on identifying whether available land is being used to its best effect and checking that the standard of newly-built property is high.

This follows the government's Barker housing supply review in 2004 which found cause for concern that the sector was "not working well for consumers", called for a code of conduct to be drawn up by constructors and suggested the OFT be called in if consumers were still unhappy with standards in three years - hence the new investigation.

25 Jun 2007