Redrow's Steve Morgan warns Wales' regulations will create 'no-go' areas
The chairman of Wales' biggest housebuilder Redrow says parts of the country will become "no-go areas" if tougher building regulations are introduced.
Steve Morgan argues plans by the Welsh government to make new homes more energy efficient will increase costs.
He believes it will lead to affordable housing not being viable and areas such as Wrexham and the south Wales valleys.
He added that housebuilding is easier in England.
Mr Morgan, who founded Flintshire-based Redrow in 1974, also argues new houses will not be built in cheaper areas in the future without a subsidy.
Proposals for high environmental standards and sprinklers in homes will add £11,000 to building costs of a basic three-bedroom house in Wales by 2015, he said.
He said the company was "proud" to be Welsh but the proposed changes would make some of those areas "un-economical" to build on.
"If we get squeezed out of Wales, which I believe will happen, then it's a sad day for Wales," Mr Morgan said.
"I'm really concerned that whole parts of Wales will become no-go areas for house building - because house builders will not be able to get the returns they need - and if can't get the returns we won't bother and actually go into England and do it there," he added.
Wynn Pritchard, director of training body Construction Skills Wales, said there needed to be a balance between building sustainable homes and the costs for house builders.
"I don't think anybody's disagreeing there needs to be quality, sustainable and quality housing within Wales and affordable," he said.
"Construction is a major economic driver for Wales and to actually lose somebody like Redrow from the Wales environment would have a serious impact in terms of apprenticeships and growth."
Earlier this year, the Welsh government said it was going to press ahead with its policy of fire sprinklers in all new homes from 2013, despite being told that it is not cost effective.
Ministers say it will save a predicted 36 lives and prevent an estimated 800 injuries between 2013 and 2022.
A Welsh government spokesperson said: "Welsh proposals around changes to building regulations and the installation of fire sprinklers in Wales are aimed at delivering lower fuel bills and greater safety standards for householders.
"We do recognise they would have cost implications for homebuilders and may also have implications for low value areas and that is why both proposals are subject to full consultations."
The government is currently analysing responses to its consultation on proposals to increase energy performance of new homes.
"European legislation requires a significant step in energy performance by 2021," the spokesman added.
"Our proposals which we intend for introduction in 2015 are a step towards meeting that requirement. The phased introduction will allow the construction industry to plan ahead."
The Labour AM who introduced legislation on installing sprinklers in new homes said Mr Morgan's comments were "wholly irresponsible".
Vale of Clwyd AM Ann Jones said: "There is nothing stopping Redrow from fitting sprinklers now.
"So, come on Steve, fit sprinklers in your next development and see how much they really cost."