Scotland’s ‘housing gap’ approaching 100,000 homes

Scotland is suffering from a chronic housing shortfall approaching 100,000 new homes as a result of significant and consistent undersupply over the last 14 years, according to a report released today.

Scotland’s 'housing gap' approaching 100,000 homes

Nicola Barclay

Industry body Homes for Scotland (HFS) is calling for an all-tenure target of at least 25,000 homes per year to be set to meet current levels of need and demand.

HFS commissioned independent consultancy Lichfields to explore the social and economic benefits of new homes. As part of that work, they noted that the country is missing out, not only on these much-needed new homes but also the huge wider benefits which result from their construction.

The report is based on figures from 2019 (the year prior to the Covid pandemic when approximately 22,500 new homes were built). Those missing benefits include £52 million of local infrastructure investment which could have been spent on education, health and community facilities, as well as support for over 8000 jobs.

The Social and Economic Benefits of Home Building in Scotland report highlights that, for the last 14 years, Scotland has not achieved the yearly requirement of 25,000 new homes, the minimum quantity HFS believes is necessary to keep up with demand. HFS is calling upon the Scottish Government to commit to this all-tenure target level for new homes each year to meet need and demand and deliver the additional social and economic benefits that this level of new homes would provide.

The report’s authors state that local authorities and government should look beyond the bricks and mortar of home building and recognise the huge additional social and economic potential this unlocks at a regional and national level. Taking statistics for 2019, when approximately 22,500 new homes were built, the study calculates the gain that could be achieved by increasing completion levels to 25,000.

The report evidences that this would result in:

  • Improved access to fit-for-purpose, energy-efficient accommodation for thousands of additional households
  • Improved health and education outcomes and enhance quality of living (with additional investment in community facilities, affordable housing and infrastructure)
  • A potential 8000 additional new jobs
  • Additional contributions of £30,500 towards local facilities for each private home built
  • Increased economic output of £300 million

These benefits are in addition to the £500 million already paid in developer contributions annually for affordable housing, community facilities and infrastructure; the 79,000 jobs the home building sector currently supports; and the more than £3 billion that it generates in terms of economic output.

HFS chief executive Nicola Barclay said: “Having a home is the most basic of human needs. Indeed, it is recognised by the UN as a human right. Yet there are still too many examples of people in Scotland without a home at all or living in substandard accommodation, and we all have personal examples of people we know struggling to find a home that they can afford as house prices and rents continue to soar due to lack of supply.

“Crucially, the standard of housing has a direct link to educational attainment and the life chances of our children. Poor housing quality also has myriad impacts on health – a heavy personal cost borne by the individuals themselves, and to our health service.

“As the 2019 figures show, although we have been making progress towards the 25,000 homes of all tenures that we believe is necessary, there remains a significant housing gap. It is also still 12 per cent less than pre-2008 recession levels, resulting in a cumulative undersupply approaching 100,000 homes. The impact of reduced output due to Covid and supply chain issues during 2020 and 2021 has only exacerbated this situation.

“As well as fuelling house price inflation, this is causing regional disparities and preventing people from getting on and leading fulfilling and independent lives, whether that is moving out from the parental home, relocating for work, starting a family or downsizing.”

She added: “What I hope the report clearly illustrates is that housing cannot be viewed in isolation. The hugely positive impact that having a decent home has on people’s daily lives and the environment in which we live cannot be understated. This is reflected in the report’s case studies which highlight the importance of warmth, space and security - regardless of individual circumstance.

“Scotland already derives so much benefit from home building but there is still so much more potential to maximise. Now is the time for us all to support the delivery of more homes and commit to an all-tenure target of 25,000 homes per year.”

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