Housing association new build completions fall by 19% in a year

The number of new build homes completed by housing associations in Scotland has dropped by 19% since last year and by 43% in the last three months, according to new figures.

The latest Quarterly Housing Statistics, released today by Scotland’s Chief Statistician, revealed that there were 386 housing association completions between July and September 2017, 43% less than the 681 completions in the same quarter in 2016. The total for the year to end September 2017 was 2,169, a 19% (525 homes) decrease on the 2,694 completions over the previous year.

Council housebuilding continued to rise with 369 local authority completions recorded between July and September 2017, which is 66% more than the number that were completed in the same quarter in 2016. This brings the total for the year ending September 2017 to 1,391, which is a 21% (239 homes) increase on the 1,152 completions the previous year.

The total number of social sector completions (housing association and local authority completions combined) decreased by 286 homes (7%).

Taking into consideration a rise in private-led completions (9% or 1,194 homes), the number of new build homes completed across all sectors in Scotland last year was 17,601, an increase of 5% (908 homes) than the previous year.

There were 19,440 all sector new build starts in the 12 months to end September 2017, an increase of 1,536 homes (9%) on the 17,904 starts in the previous year. Private-led starts increased by 805 homes (6%) and housing association approvals increased by 1,180 homes (33%), whilst local authority starts decreased by 449 homes (29%).

Communities secretary Angela Constance said the Scottish Government remains on track to deliver its commitment of at least 50,000 affordable homes over this Parliament.

The minister said: “Ensuring everyone has access to a safe, warm and affordable place to call home is at the heart of our ambition for a fairer Scotland. These latest figures show that we have now delivered nearly 72,500 affordable homes, which includes nearly 50,000 for social rent, since 2007. They also highlight that the number of social rented homes being started increased by 17% in the latest year.

“We are committed to ensuring much greater progress, backing that with record levels of investment, with funding of £3 billion – the single biggest investment in, and delivery of, affordable housing since devolution. This includes more than £756 million for affordable housing in 2018-19 alone – a 28% increase on the previous year – and all councils have been given long term planning assumptions, totalling £1.75bn to March 2021. That provides the assurance needed to deliver the homes required, and we know that many more developments and proposals are coming through as a result of that.

“As a recent report by Shelter Scotland, Scottish Federation of Housing Associations and the Equalities and Human Rights Commission showed, we are on track to deliver our commitment of at least 50,000 affordable homes over this Parliament. We will continue working hard with councils, housing associations and others to ensure that benefits communities across Scotland, delivering the right homes, in the right places.”

Homes for Scotland said the 5% increase heralds a “step in the right direction” towards addressing the country’s housing crisis.

Chief executive Nicola Barclay said: “These latest year-on-year figures are encouraging for our sector given the increases noted in both starts (9%) and completions (5%). Having identified a need for 10% year-on-year growth in order to see a return to pre-recession build levels of at least 25,000 homes per year, today’s statistics are certainly a welcome step in the right direction towards a sustainable recovery.

“The fact remains that Scotland’s chronic undersupply of housing impacts the needs and aspirations of our growing population as well as wider investment and economic growth.  It is therefore crucial that local authorities, developers and others involved in the process continue to work together to build on this momentum if we are to make up for the ground lost since the downturn.”

David Stewart, SFHA policy lead, added: “The figures show a marked increase in approvals for new housing association homes – up 33% on the previous year. We always knew that delivering 50,000 affordable homes would be a significant challenge – but it is one that housing associations are committed to meeting in order to deliver much needed quality affordable homes.

“The increase in approvals for new housing association homes reflects the findings of research commissioned by SFHA and Shelter on Strategic Housing Investment Plans, which found that housing associations, local authorities, and their partners in the private sector are working hard to increase supply and on course to deliver 50,000 affordable homes.”

Andy Wightman MSP, housing spokesperson for the Scottish Greens, said the statistics show the need for a rethink of government policies in order to tackle Scotland’s housing crisis.

The MSP for Lothian said: “We are far from addressing the housing crisis, especially with the total number of affordable housing supply completions down 8% on the previous year.

“Undoubtedly our housing system is based on an ineffective model that does not address housing need in areas where there is a chronic shortage of homes. The current drive towards private home ownership led by the volume house building industry and assisted by the Scottish Government’s Help to Buy scheme only benefits the shareholders of these companies and does very little to facilitate genuinely affordable accommodation for individuals and families throughout Scotland.

“We need a serious rethink of government policy, giving local councils the kind of powers taken for granted in other European countries – powers to acquire land at existing use value rather than developers’ inflated value, powers to tax vacant and derelict land, and a Homes First policy that gives councils to power to regulate the short-term lets that are removing badly-needed long-term family homes from the market.”

The Scottish Conservatives argued for a mixture of new incentives and stronger regulation to be introduced to bring empty properties back into use.

Housing spokesman Graham Simpson said: “The SNP must introduce a Help to Rebuild scheme which could bring together disparate grant schemes under one easily accessible umbrella programme.

“In addition, the SNP must enable empty business premises to be turned into affordable housing as well as help farmers convert empty buildings into housing.

“The SNP must take innovative action to tackle this rise in empty properties, help solve the housing crisis and enable more people to realise their dream of having a home.”

Annual all sector new build starts and completions, 2007 – 2017

Key Points

New Build Housing – All Sectors

  • There were 4,018 new build homes completed between July and September 2017; a 9% increase (316 homes) on the same quarter in 2016. This brings the total for the year to end September 2017 to 17,601, up 5% (908 homes) compared to the 16,693 completed in the previous year.
  • There were 4,081 new build homes started between July and September 2017, 18% less (884 homes) than the same quarter in 2016. This brings the total for the year to end September 2017 to 19,440 which is up by 9% (1,536 homes) compared to the 17,904 homes started in the previous year.

New Build Housing – Private-led Housing

  • Between July and September 2017, 3,263 private sector led homes were completed; 17% more (464 homes) than the same quarter in 2016. This brings the total for the year to end September 2017 to 14,041 which is 9% more (1,194 homes) than the 12,847 completions in the previous year.
  • There were 3,146 private sector led starts between July and September 2017, down 14% (499 homes) on the same quarter in 2016. This brings the total for the year ending September 2017 to 13,591, which is 6% (805 homes) more than the 12,786 starts in the previous year.

New Build Housing – Social Sector Housing (Housing Association and Local Authority combined)

  • There were 755 social housing completions between July and September 2017; 16% less than the same quarter in 2016. This brings the total for the year to end September 2017 to 3,560. This is a 7% decrease on the 3,846 social sector completions in the previous year.
  • Meanwhile, 935 social sector homes were started between July and September 2017; 29% less than the same quarter in 2016. This brings the total for the year to end September 2017 to 5,849. This is a 14% increase on the 5,118 social sector starts in the previous year.
  • More up-to-date figures show that, between October and December 2017, 788 social sector homes were completed (14% fewer than the 919 completions in the same quarter in 2016), and 1,267 were started (13% more than the same quarter in the previous year). This brings the total completions for the 12 months to end December 2017 to 3,429 (a 12% decrease on the 3,897 social sector homes completed in the previous year). Total starts over the 12 months to end December 2017 are now at 5,996 (17% more than the 5,123 started in the previous year).

New Build Housing – Housing Association Homes

  • There were 386 housing association completions between July and September 2017, 43% less than the 681 completions in the same quarter in 2016. This brings the total for the year to end September 2017 to 2,169, a 19% (525 homes) decrease on the 2,694 completions over the previous year.
  • There were 540 housing association approvals between July and September 2017; 34% less than the 817 approvals in the same quarter in the previous year. This brings the total for the year to end September 2017 to 4,743. This is an increase of 33% (1,180 homes) on the 3,563 approvals in the previous year.
  • More up-to-date figures show that a total of 340 Housing Association homes were completed between October and December 2017, 41% (240 homes) less completions than in the same period in the previous year. This brings the total completions for the 12 months to end December 2017 to 1,929, which is a decrease of 29% on the 2,707 homes completed in the previous year. A total of 718 Housing Association homes were approved between October and December 2017, 17% less than the 860 approvals in the same quarter in 2016. This brings the total approvals for the 12 months to end December 2017 to 4,601, a 26% increase on the 3,638 approvals in the previous year.

New Build Housing – Local Authority Homes

  • There were 369 local authority completions between July and September 2017, which is 66% more than the number that were completed in the same quarter in 2016. This brings the total for the year ending September 2017 to 1,391. This is a 21% (239 homes) increase on the 1,152 completions the previous year.
  • There were 395 local authority starts between July and September 2017; 21% lower than the number in the same quarter in 2016. This brings the total for year ending September 2017 to 1,106. This is a 29% (449 homes) decrease on the 1,555 starts in the previous year.
  • More up-to-date figures show that, between October and December 2017, 448 local authority houses were completed (32% more homes than the same quarter in the previous year), and 549 were started (more than double the 260 homes started in the same quarter in the previous year). This brings the total completions for the year to end December 2017 to 1,500, which is 26% more than the previous year. Total starts for the 12 months to end December 2017 now stands at 1,395 which is a decrease of 6% on the 1,485 local authority homes started in the previous year.

Affordable Housing Supply – up to end December 2017

  • Affordable Housing Supply Programme (AHSP) statistics reflect the broader supply of affordable homes (i.e. for social rent, affordable rent and affordable home ownership) and include off-the-shelf purchases and rehabilitations as well as new builds.
  • The latest statistics for the year to end December 2017 show that affordable housing supply completions have totalled 6,647, down 8% (617 homes) on the previous year. This includes an increase in affordable home ownership completions (up by 9% or 156 homes), but with decreases in social rent completions (down by 9% or 409 homes) and affordable rent completions (down by 34% or 364 homes).
  • There were 9,552 affordable housing approvals over the year up to end December 2017, up by 7% or 600 homes compared to the previous year. This includes increases in social rent approvals (up by 7% or 422 homes), affordable rent approvals (up by 1% or 17 homes), and affordable home ownership approvals (up by 8% or 161 homes).
  • There were 9,422 affordable houses started in the year to end December 2017, up by 12% or 1,036 homes compared to the previous year. This includes increases in social rent starts (up by 17% or 878 homes), affordable rent starts (up by 9% or 102 homes), and affordable home ownership starts (up by 3% or 56 homes).
  • Quarterly affordable housing supply statistics are used to inform the Scottish Government target to deliver 50,000 affordable homes, including 35,000 homes for social rent, over the period 2016/17 to 2020/21.

Local Authority Right to Buy Applications and Sales

  • The Right to Buy scheme closed to all new applicants on 31 July 2016, therefore there have been no Right to Buy applications made during the last year (October 2016 to September 2017). Throughout the final year of the scheme (the year to end September 2016) there were 9,060 applications made, more than double the 3,890 applications that were made in the previous year to end September 2015. This increase is likely to have been because this was the last chance for social housing tenants with an entitlement to exercise their Right to Buy before the scheme closed.
  • It can take a period of time for applications to be processed and for sales to be made, and therefore Right to Buy sales are still being recorded. In the latest available quarter, July to September 2017, there were 587 Right to Buy sales, 18% less than the 716 sales in the same quarter in the previous year, and also 25% less than the 787 sales in the previous quarter, April to June 2017. It is expected that sales will continue to fall further in future quarters as the number of applications remaining in the system falls.