The Office of Fair Trading (OFT) in Britain has launched an investigation into the UK's £20 billion a year house-building sector.
The consumer affairs watchdog will scrutinise the competition and consumer issues in the house-building industry to ensure both the supply and standard of new homes are giving buyers a fair deal.
The OFT said it had been monitoring the house-building market following recommendations in the Government's landmark 2004 Barker housing supply review and had found cause for concern the sector was "not working well for consumers".
The body could also refer the industry to the Competition Commission for further investigation. John Fingleton, chief executive of the OFT, 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 added: "For individual house buyers, even low levels of dissatisfaction can translate into very high detriment."
The OFT will focus on two key areas — whether land suitable for development is being used to best effect and the standard of properties being built.
The study comes three years after the housing supply review, led by economist Kate Barker, which focussed on the reasons for the lack of new homes being built. Ms Barker called on the the industry to increase customer satisfaction and introduce a code of conduct, with recommendations the OFT should conduct a wide-ranging investigation if buyers were still found to be unhappy with standards within three years.
PA