Is Scotland facing a housing crisis?

Written by Kate Shannon on 8 October 2015 in Inside Politics

Scotland's housing sector is facing huge challenges

In June this year, the independent Commission on Housing and Wellbeing called for a “radical” look at the future direction of housing policy in Scotland. It also linked the benefits of having a decent, safe and secure home to better health and life chances for all.

The commission, set up by homelessness charity Shelter Scotland, made 18 recommendations and called for the construction of 23,000 new homes a year, including 9,000 affordable homes. Former Auditor General for Scotland, Robert Black, chaired the commission. He said: “This report is about the central importance of everyone in Scotland having a safe, secure and suitable home which allows each and every one of us to live fulfilling lives and achieve our potential.

“We are a long way short of this. There are about 150,500 households on waiting lists for social housing, 940,000 in fuel poverty and over 60,000 are overcrowded. With an averagely priced house now costing about five times the average annual income, owning your own home is becoming an unachievable pipedream for many people in Scotland, especially young adults and families.

“A key recommendation of the report is the need for a dramatic increase in house building and calls for the construction of 23,000 new homes a year, including 9,000 affordable homes. It also sets out the major challenges for the next decade on issues including housing benefit and council tax reform, freeing the supply of land for new housing, recognising and supporting the growing role of the private rented sector, and stepping up the pace in reducing residential greenhouse emissions.” 

Spending on housing should be seen as a preventative measure, the report said.

Anne Jarvie, former chief nursing officer for Scotland and member of the commission, added: “During our consultations across Scotland, we heard the true life stories of people’s struggles with bad housing and homelessness and clear evidence of how these issues link to long-term health problems. Having to live in cold, damp and completely unsuitable properties or not having a permanent home risks the long-term physical and mental health and wellbeing of many people, particularly children. By acting now we can help to end this inequality and create an environment where current and future generations in Scotland can prosper and flourish.”

Following the publication of the commission’s findings, Alex Neil, Cabinet Secretary for Social Justice, Communities and Pensioner’s Rights, said: “Housing is at the heart of the Scottish Government’s ambitions to create a fairer and more prosperous country, and it is our aim that everyone should have a safe, warm home which suits their needs and they can afford. Access to good quality housing is a vital part of this government’s drive to secure economic growth, promote social justice, strengthen communities and tackle inequality.

“I welcome this report which contributes to our vision for housing in Scotland. Working creatively with our partners we have developed a range of pioneering, innovative approaches at maximum value for taxpayers’ money to tackle Scotland’s housing challenges. This includes tackling energy efficiency, housing standards and our commitment to deliver 30,000 new affordable homes by 2016.”

Alex Johnstone, Scottish Conservative housing spokesman, said the report came as “no surprise”. He added: “For a while now we’ve known about the true extent of the housing crisis in Scotland thanks to the SNP. During their eight years in office they have targeted the housing budget for disproportionate cuts. For Alex Neil to now say that he is confident that the Scottish Government will meet their less than ambitious targets against a backdrop of failure only adds insult to injury.

“Owning your own home is an aspiration but first-time buyers are now struggling to get a foot on the housing ladder. This is unacceptable. We should never forget how helping young people buy their own property can contribute to Scotland’s housing needs.”

For local authorities, housing is a big issue. Jim Hayton, Association of Local Authority Chief Housing Officers (ALACHO) policy manager, told Holyrood: “The term ‘housing crisis’ may be overused, but how else to describe the current situation where housing supply falls so far short of meeting the needs of those among Scotland’s people who badly need a decent affordable home to live in? 

“In addition to increasing the supply of good quality affordable housing, local authorities also face difficult issues, for example, in identifying and resourcing appropriate responses to the challenges of reducing fuel poverty while improving energy efficiency of the housing stock; in mitigating the sometimes catastrophic impact of national welfare reforms on vulnerable households, and in improving outcomes for those reliant on our health and social care services through early housing and support interventions which can prevent the need for expensive interventions further down the line, to name but three.

“As the representative body for Scotland’s local authority senior housing professionals, ALACHO,  through working with the Scottish Government and other partners, intends to play a full role in  meeting these challenges and improving housing conditions for people throughout Scotland.”

In her Programme for Government, First Minister Nicola Sturgeon said good quality, affordable housing is “essential for people to live happy, healthy and fulfilling lives”. 

She added: “Over the past decade, the rate of new house completions has been higher in Scotland than it has in England. Much of that is due to our investment. I can confirm that, by the end of March, we will not just meet but exceed our target for the present session of Parliament of delivering 30,000 affordable homes, but we intend to do more. 

“Over the next year, we will establish a rural housing fund to better meet the needs of rural communities. The Help to Buy scheme has helped 6,500 people to buy homes and has provided support for the construction sector, including the 211 small companies that are registered for the small developers fund. I am announcing that we will invest an additional £195 million over the next three years to extend the scheme. We will set out more detail following the spending review in November.”

Responding to this, Philip Hogg, chief executive of home building industry body Homes for Scotland, said: “Given the significant impact of the current Help to Buy (Scotland) shared equity scheme with regards to employment, investment and wider community benefits, as well as boosting housing completions, we are encouraged by the commitment of £195 million to support a successor scheme over the next three years.

“Whilst the new scheme has a smaller budget in comparison to the £305 million for Help to Buy (Scotland), we hope it will help provide further confidence to both consumers and builders but await further detail on criteria and accessibility before being able to assess its likely impact.”

While the construction industry has suffered a lot in the recent recession, it appears there might be light at the end of the tunnel. According to new statistics, the number of new homes built in Scotland rose by nine per cent in the last year. The number of new homes completed across the private and social sector rose to 16,281 between April 2014 and March 2015, compared to the same period in 2013/14.

In addition, the overall supply of housing, which covers new builds, refurbishments and conversions, increased six per cent to 17,149 in 2014/15 compared to the previous year.
However, Green MSP Patrick Harvie highlighted concerns over dwindling social housing numbers. He said in 2014 there were 317,572 local authority dwellings in Scotland, a decrease of 588 from the previous year. Furthermore, sales of public authority dwellings rose by 26 per cent. 

He said: “While schemes like Help to Buy open up home ownership to many people who previously didn’t have this opportunity, we should be clear about the limitations of such programmes.

The latest figures show there is no end in sight for the destruction of social housing in Scotland. Schemes to encourage buyers do nothing to ensure that those who are far off from being able to afford a mortgage have a place to call home.

“A rapidly increasing number of people have been pushed into the private rented sector because of a steady decline in the number of socially rented homes available. This is of huge concern for all those who cannot afford to buy and for whom astronomically high rents in the private sector are simply unaffordable.

“The socially rented sector is vital to Scotland, and we cannot rely on market solutions alone to deliver decent housing for our society. While supply of new homes is a welcome development, the Scottish Government must not lose sight of the urgent need for good quality, secure socially rented homes.” 

Scottish Labour used its first debate of the new session of the Scottish Parliament to throw its support behind a call for action to tackle Scotland’s housing crisis. 
Ken Macintosh MSP, Scottish Labour communities spokesperson, said: “Ensuring everyone has access to a decent home should be the starting block in our mission to build a more equitable society. It’s not an impossible dream and it’s not an unrealistic goal. All that is required is the political will.

“Sadly, not a week has gone by this summer without further evidence or a new report highlighting the housing problems that are facing thousands of Scots. [In August] the proportion of Scots who own their own home hit a 15-year low, while the number who rent privately hit a 15-year high. 

“In fact, the amount that is paid in rent by tenants in private lets is at an all-time high. Too many people are either paying too much, living in inadequate accommodation, or both. 

“Scottish Labour has chosen housing to be the subject of our first debate in this new Scottish parliamentary session because we believe it needs to become a political priority.  

“This is not just about the Scottish Government’s record, nor about drawing a comparison between this and previous administrations. It is about using the powers of the parliament to tackle the problem before us, to improve people’s lives, and to ensure every Scot has a safe, warm and affordable home.”

Speaking in Labour’s debate, Liberal Democrat Alison McInnes welcomed the announcement of a successor to the Help to Buy scheme but urged the Scottish Government to provide details as soon as possible. 

She said: “Although we have seen the positive nine per cent rise in the number of new-build houses, we must recognise that that is largely due to the predecessor to the scheme and the private build sector driving progress. The fact that the right-to-buy scheme is being brought to an end in April next year, and its expiration date is nearing, makes the release of information on the Help to Buy scheme even more urgent.

“In addressing the housing shortage in Scotland, we need to heed the findings of the Commission on Housing and Wellbeing. A house, an education and respectable healthcare—these are the issues that we need to tie together. However, guaranteeing that each person has an appropriate, safe, warm house is the foundation stone for giving each individual a chance to experience the best standards of living.”

The Scottish Government recently announced hundreds of affordable homes are being built on redundant public sector sites. Former publicly-owned land and buildings across Scotland, including hospitals, prisons and police stations, are being redeveloped to allow hundreds of affordable homes to be built. The Scottish Government, working closely with public sector partners, said it is supporting projects in Edinburgh, Perth and Kinross, Aberdeen, Falkirk and in the Highlands.

Alex Neil said: “Housing is, and will remain, at the heart of the government’s ambitions to create a fairer and more prosperous country. Vacant land and property which was previously in public sector ownership – such as by NHS Scotland and Police Scotland – is being used to add to the provision of affordable housing across Scotland.

“The redevelopment of the former Eastern General Hospital site is an excellent example of what can be realised when partners share a vision of what can be achieved for the benefit of the local community. This government has invested record funding in housing and has developed a range of pioneering approaches to tackle Scotland’s housing challenges.” 

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