15 April 2024 , 08:04
521
0
Kevin McCloud, the presenter of Grand Designs, has slammed the UK property market as "broken and dysfunctional", claiming it's dominated by large housebuilders seeking hefty profits.
He believes that the UK is lagging behind other European nations like Germany and Sweden in terms of housing development. Mr McCloud said: "If I were the housing minister I'd be looking at ways to break this monopoly that two or three companies have over the market."
He argues that a lack of competition among developers is suppressing quality and innovation, making the market more susceptible to downturns. "We have effectively a broken market, a dysfunctional market, it has been hollowed out," he said. "It means that when we hit difficulty, those companies nosedive and they buy each other out."
He added: "If, like Germany, we had a really resilient market with thousands of medium-sized companies, you'd find a general ability to flex and respond in a way that is not motivated by panic." His remarks follow the announcement of a £2.5billion merger between two of the country's largest developers, Barratt Developments and Redrow, in February.
The deal is currently under scrutiny by the UK's competition watchdog to determine if it could significantly diminish competition in the sector. Mr McCloud expressed his astonishment at the scale of corporate turnovers, remarking: "Why on earth a company should be allowed to turn over an amount of money equivalent to the GDP (gross domestic product) of a small nation, I don't know. That seems to flout some competition laws."
Martin Lewis’ MSE website shares tip to get free £175 and 7% interest on savings
The Grand Designs presenter is gearing up for the Grand Designs Live premier home exhibition, set to launch at London's ExCel in May before moving on to Birmingham come October. He added: "Fifteen years ago, we led the world in the standards we were applying to construction and driving towards net zero. We were winning the race."
"Now, we're trailing behind our housing industry's performance has plummeted, and the expertise in construction has just drained away," he added. McCloud pinpointed the Brexit vote as a pivotal moment for the construction sector, which heavily depends on international workers and has since struggled with a shortage of labour.
"With Brexit, we saw a lot of people disappear back to other European homes. They were really supporting and masking the lack of skilled trade in the UK, because we had so many foreign workers here who were really skilled."
Recent times have seen the UK's construction industry grappling with significant challenges, not least the residential sector, which is reeling from the effects of soaring interest rates that are putting the squeeze on the housing market. Builders have also been wrestling with challenging economic conditions, such as increasing prices, dwindling demand and supply chain disruptions.
However, there are initial indications of a shift, with the sector bouncing back in March following a six-month downturn, as per the most recent S&P Global construction survey.