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Housing Development

Volume 447: debated on Friday 16 June 2006

To ask the Deputy Prime Minister what steps he is taking to prevent excessive land banking by housing developers. (66426)

I have been asked to reply.

The Barker Review of Housing Supply considered the issue of land banking in assessing competition in house building, and did not find evidence of excessive land banking by house builders.

The Review did make recommendations designed to make the planning system, and its arrangements for releasing land for housing, more responsive to demand, in the interests of improving housing affordability. Draft Planning Policy Statement 3 published earlier this year is designed to achieve these objectives.

The Office of Fair Trading periodically reviews the house building sector. If there is evidence of anti-competitive behaviour which was against the consumer, including excessive land banking by house builders, OFT may consider the case for a reference to the Competition Commission.

The Department is concerned to ensure that there is proper competition in the house building sector and that land banking or the holding of options do not operate as a barrier to entry. We are continuing to keep this under review to ensure that greater land supply results in increased house building.