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The Competition and Markets Authority has launched a housing development investigation and is separately initiating a consumer rights investigation for tenants.
The watchdog says its investigation came after “concerns that builders are not building the homes people need at a sufficient scale or at a sufficient speed.”
He adds that his research into the rental sector “will aim to shed light on the tenant experience and see if more can be done to help landlords and resellers understand their obligations.”
The move also follows an exchange of letters published in December between Michael Gove and CMA chief executive Sarah Cardell, in which he pushed for an investigation into the sector.
CMA’s Cardell now says: “The quality and cost of housing is one of the biggest challenges facing the country.
“If there are competition problems holding back housing development in Britain, we need to find them. But we also need to be realistic that increased competition will not, on its own, lead to a housing boom.
“In the same vein, we want to look into people’s experiences in the rental industry and see if there are issues that CMA can help with.
“Of course, we will be guided by the evidence, but if we find competition or consumer protection issues, we are ready to take the steps necessary to address them.”
In December, a letter was issued from the Level Up Department, CMA Secretary of State for Housing and Communities, reaffirming his support for the housing industry study.
Gove wrote: “It is very important that we have a housing sector that works effectively to build the homes that people need.
“Housing plays a key role in achieving our ambition to rise to the next level. Buying a home is one of the most important decisions a family makes, with huge financial implications, so making sure this market is working in the best interests of consumers is critical.”
He added that the last study of the housing market was conducted 14 years ago, and since then the market and the country have experienced “significant changes” such as net zero, changing market structure after the financial crisis and changing demographic trends.
Cardell responded that the regulator was “developing proposals for work in this area,” adding that a decision to continue the year-long investigation would be made at its January board meeting.
These letters, originally exchanged in November, were released in December, the same day Gove was forced to tell a number of Conservative MPs that the government’s goal of 300,000 homes a year was a “starting point” and would be “advisory” and not mandatory. .
The move comes after a House of Commons vote on an Equalization and Regeneration Bill was defeated in November after 60 Conservative MPs signed an amendment calling for the goal to be abolished.
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