Achi news desk-
The change of leadership came after one of a number of controversial pieces of legislation was raised when the chief executive of a major Scottish housebuilder urged Holyrood to rethink aspects such as rent controls.
This followed weeks of discontent over the Housing (Scotland) Bill, which I have dealt with and collated.
Shelter Scotland said “housing must have its own seat at the Cabinet table” with a Minister dedicated to the housing shortage crisis.
Springfield Properties revealed it saw a major deal collapse on the day the Scottish Government introduced rent controls, and it is now estimated that £3 billion in wider build-to-rent investment is being put at risk by formalizing the policy.
Innes Smith of the Elgin-based London listed company told The Herald: “The day the Scottish Government announced a rent freeze, we immediately saw a deal to provide 300 energy efficient PRS (Private Rented Sector) homes of quality, falls, and this investment. has been lost.
“These homes were designed for families looking for sustainable rental homes and would have eased the pressure in areas where housing is in high demand including Inverness and Midlothian.
“This is designed as the first of many deals using private investment to enable progress in housebuilding across multiple tenures.”
The housebuilders who provide the vast majority of their homes to Scotland have collectively criticized plans for permanent rent controls and also questioned net zero targets relating to new builds after the Government Scotland changed its target.
Homes for Scotland, the body which represents around 200 companies which together provide most of the new homes being built across the country, has also called for a review of the proposals and the timetables after Holyrood abandons its 75% emissions reduction by 2030.
I have written a series of Business Week columns about issues housebuilders are raising with the Scottish Government regarding the Housing (Scotland) Bill, which has now been introduced.
Temporary rent controls introduced in part to help ease the cost of living during a crisis look likely to be part of legislation, but the impact this has on the build-to-rent market in Scotland is uncertain. considerable, according to industry insiders.
In response, Green MSP Patrick Harvie pointed to rent controls and investment in Europe, and said that Holyrood was working with industry on future net zero regulations but appeared to remain firm on key points. .
The background is a growing housing crisis across the country, with four local authorities declaring emergency status due to the housing shortage.
I wrote that housebuilders in Scotland have warned that the SNP and the new Green Housing Bill risk “serious unintended consequences” amid concerns that investors are backing away from financing Scottish homes.
Homes for Scotland said that “current levels of housing need in Scotland are more complex and much higher than what is currently being accounted for”.
A study found that 28% of Scottish households, almost 700,000, currently have some form of housing need, including overcrowded households and those in need of affordable housing.
The study was commissioned by Rettie and The Diffley Partnership from Homes for Scotland, whose board includes Doug McLeod, Scotland director for Barratt Homes, Mr Smith of Springfield Properties, and Janice Russell, managing director of McTaggart Construction.
Jane Wood, chief executive of Homes for Scotland, said it is unlikely that this Bill will deliver the urgent action needed to increase the number of much-needed homes across all tenures”.
He said: “There is nothing to support the under-resourced planning system which takes over 62 weeks to process a large housing application or to improve the overall policy and regulatory environment which currently hinders the process of provide new homes.
“It could also have serious unintended consequences given that the rent controls introduced in 2022 have led to investment in new homes being diverted to other parts of the UK, while rents here continue to rise.”
I also revealed that the essential build-to-rent market in Scotland is “essentially closed” until there is more clarity on the SNP’s homes law and the Green administration.
Unease over rent controls is growing to the point where the market has virtually ground to a halt in Scotland, a senior industry figure told The Herald, while construction and investment continue unabated south of the Border.
There is also a call for a review of new net zero laws affecting household provision after the current Holyrood administration scrapped its own emissions targets.
Homes for Scotland wants the SNP and the Greens to rethink the viability of net zero legislation from a housing supply perspective.
Mr Harvie told The Herald: “Our Housing Bill contains a package of important reforms to the rental sector which aim to improve affordability and strengthen tenants’ rights. This includes introducing an effective system of rent controls in the private rented sector, which will improve affordability for tenants while recognizing the importance of landlords investing in property quality.
“Our European neighbors have shown that rent control can be compatible with continued investment, and we will continue to engage with stakeholders from across the sector on delivering on our commitment to introduce a longer-term system of rent controls for Scotland. Alongside this, we are committed to encouraging new and different methods of attracting investment into our housing sector and the launch of our new Housing Investment Taskforce this month is an important step in that work.”
He also said separately: “We are currently carrying out a review of energy standards – engagement began early in 2023 and Cartrefi i l’Arban is a contributing member of the associated working group.
“We intend to consult on proposals at the end of the summer, to support our commitment to the Senedd to confirm any changes to regulations in December this year.”
This article first appeared in the Business HQ Monthly supplement.
