Editor's note: This brief was summarised by The Property AI Newsroom from a report by PropertyWire. Read the original article for full details.
Eight Housebuilders Named in Proposed £4.5bn Class Action
Eight of Britain’s largest housebuilders are facing a proposed class action worth up to £4.5 billion. More than 700,000 homebuyers claim they paid inflated prices for new-build properties due to alleged anti-competitive practices.
The claim is set to be filed with the Competition Appeal Tribunal by Mark McLaren, a former parliamentary and legal affairs manager at consumer group Which?. The action is directed against Barratt Redrow, Bellway, Berkeley Group, Bloor Homes, Persimmon, Taylor Wimpey, Vistry Group, and its Countryside Partnerships division.
Background: CMA Investigation and Allegations
The proposed claim follows an investigation by the Competition and Markets Authority (CMA) into allegations that major housebuilders exchanged commercially sensitive information over a two-year period ending in February 2024. The CMA closed its investigation after the companies agreed to pay £100 million towards affordable housing programmes and accepted legally binding commitments not to share commercially sensitive information in future.
McLaren’s claim alleges that the exchange of information reduced competition between the firms, resulting in consumers paying more than they should have for new-build properties. The claim covers purchasers of new-build homes in Great Britain between October 2015 and 24 June 2026.
Compensation and Market Impact
Represented by competition law firms Geradin Partners and Hausfeld, McLaren estimates affected homeowners could each be entitled to between £3,100 and £6,200 in compensation. This gives the claim a potential total value of between £2.2 billion and £4.5 billion.
The class action comes as the UK housing market shows signs of weakening, with potential compensation payments adding financial pressure to major developers. The legal proceedings could also impact housing transaction forecasts as buyers and investors assess the implications for new-build pricing.
The Competition Appeal Tribunal will determine whether the claim can proceed as a collective action and, if successful, assess the level of compensation owed to affected homeowners.
Source: PropertyWire