OFT to investigate house builders

The Office of Fair Trading (OFT) has announced plans to investigate Britain's house building sector amid fears that it is not competitive enough and does not best serve the interests of home buyers.

In a brief statement, the OFT said it is "concerned that it (the housebuilding market) may not be working well for consumers."

The UK housebuilding sector is worth £20billion a year, and the OFT study is expected to be completed by mid-2008.The OFT will examine how regulation and competition in the sector might work more effectively. The market study will also look at ways to improve the experience of new home buyers and the quality of new homes

The investigation is being undertaken in the wake of the Barker Review of Housing Supply 2004, which recommended that there should be a relaxation of planning rules to allow the building of more affordable homes.

Since then the OFT has been monitoring the housebuilding market and says it is concerned that it may not be working well for consumers.It says it will be working with the industry as part of its review, which could result in a market investigation reference to the Competition Commission.