Scottish Housing Crisis Worst Since WWII

It could take up to ten years for Scotland’s housing output to simply return to pre-credit crunch levels of around 25,000 units per annum let alone achieve the Scottish Government’s ambitions of reaching 35,000 by 20151.

This is the claim made by home building industry body Homes for Scotland as it launched its manifesto ahead of this year’s general election, declaring that not since the end of the Second World War has the country faced a bigger housing crisis.

Chief Executive Jonathan Fair appealed to MPs as they enter the election season, he said: "Supply is touching all-time lows with some areas showing jaw-dropping drops in the number of private new homes being started (as high as 90% in both Edinburgh and the Borders, and 85% in Glasgow and Fife for example2), exacerbating the significant housing shortfall which existed prior to the recession. Therefore, continued political focus on the importance of housing investment across all tenures is the order of the day.


"Whilst there are now signs of stabilization beginning to appear in the market, the situation is such that the Scottish Government’s target of increasing the number of new homes built to 35,000 units per annum by 2015 could very likely take an extra decade to achieve"

Mr Fair spoke of the existence of "quiet optimism" but stated recovery depends on continued economic stability and mortgage availability throughout 2010.

"Ten per cent growth from a current very low base may be possible in a single year but industry hasn’t grown out of any prior recession at more than 3% per annum over longer periods," he said.

Indeed, with home ownership remaining the tenure of choice for the vast majority of Scots3, Fair pointed to the ongoing difficulties in the mortgage market as the main stumbling block to recovery, particularly as far as credit-worthy First Time Buyers are concerned. Whilst home builders are doing all they can to assist, this vital group continues to face significantly tightened lending criteria and reduced loan to value ratios.

"Clearly, home ownership should be viewed as a sustainable, long-term commitment by those looking to get onto and progress up the property ladder. However, we have relied too long on rhetoric about slowly increasing lending levels delivering tangible improvements in this area and need real substantive results now," Mr Fair concluded.

(GK)