Call for inquiry into housebuilder competition

Speaking on a panel at the annual Chartered Insitute of Housing conference in Manchester, Mike Emmerich, who set up consultancy Metro Dynamics to advise other cities on devolution and architect of the Manchester City Deal, said: ‘There are all the signs to me that this sector is dearly lacking competition.’

In a scathing assessment, Mr Emmerich said that he’d ‘never heard a bigger misnomer’ than calling them ‘volume’ house builders. ‘They don’t build very much volume,’ he said, before calling for a Competition and Markets Authority inquiry.

He argued: ‘We put it under competitive threat that if they don’t do more there’s something bad will happen.’

The comments prompted a heated debate on the panel. Jamie Ratcliff, assistant director responsible for housing at the Greater London Authority (GLA), argued that the big house builders needed support and pointing out they build 12,000 homes a year in London. ‘They won’t build homes if it’s not economic to do it.’

But Mr Emmerich responded by saying that this number of homes was not very impressive considering the scale of building needed to meet London’s housing demand.

Pat Ritchie, chief executive of Newcastle Council and former chief executive of the Homes and Communities Agency, said there is a need for a ‘mix of developers’ and variety in the housing market, but did not go so far as to criticise lack of competition. She said there is a need to work with the house builders. ‘We’re always going to get ups and downs in the housing market,’ she said, but this could be managed better.’

However, the speakers were united in calling for more devolution of housing powers to cities.

‘The real threat to housing is not going far enough or fast enough on devolution,’ said Mr Ratcliff, citing a need for devolution of fiscal powers to London such as stamp duty and council tax.

Ms Ritchie added: ‘There’s a real opportunity to go much further to make real decisions about large-scale investment programmes.’

And Manchester’s £300m housing fund is only the start, Mr Emmerich  added. He said: ‘On its own ain’t going to change the world. We’ve got to get it to scale.’