Scottish housebuilding is at “breaking point”

Viability of new housing in Scotland is at “breaking point”, it is claimed, just days after Taylor Wimpey announced it was pulling out of London.

It is a “pivotal moment” for the housebuilding industry north of the border, according to industry body Real Estate:Scotland.

The sector is grappling with “rising construction costs, levels of finance costs not seen since the 2008 financial crisis, and a plethora of additional burdens imposed upon it, such as the new Building Safety Levy”, it says.

Breaking point

“Taken together, these are stretching the viability of most development proposals to breaking point, and resulting in many of them being paused or abandoned.”

Earlier this week, Taylor Wimpey said it had stopped building new homes in London after warning the viability of new schemes had “evaporated”.

Unless urgently addressed, all development will stall.”

Cameron Stott, Chair at Real Estate:Scotland, (pictured), says: “Unless urgently addressed, all development will stall which means that we cannot deliver new housing, regenerate communities, or create new jobs.

“However, there are positive signs that the government is starting to take note, which is why despite these serious challenges, I do remain optimistic about Scottish real estate’s future.”

Housing emergency

Meanwhile, estate agency DJ Alexander has also issued a warning about the situation in Scotland, with Glasgow particularly affected.

The number of private sector new-build starts was down 1,026 – or 8% – in the past year, falling from 12,868 to 11,842, which is the lowest annual figure since 2013, it suggests.

David Alexander, Chief Executive of DJ Alexander Scotland, says: “It has now been 30 months since the Scottish government declared a housing emergency across Scotland, and yet the situation seems to be getting worse.

“There are falling new-build starts and completions and yet, rather than resolving the problem, the numbers continue to decline.”