According to research commissioned by the housing body, and carried out by Rettie and Third Revolution Projects, some affordable housing developments are stalling because housing associations have been involved too late in the process to deliver the right type of homes for local needs.

The report recommends that policy should stipulate that a Registered Social Landlord (RSL) must be brought on board and designated to a site at a certain stage so that it is better able to influence the type of housing delivered, e.g. before planning approval or post outline consent.

Typically, Section 75 Agreements are intended so that private developers contribute land, homes, or one-off payments for affordable housing as part of their overall developments.

Across Scotland, these agreements typically mean that a certain percentage of homes on a private development will be earmarked for social housing. The Scottish Government’s National Planning Framework 4 (NPF4) sets a target for 25% of proposals for market homes to be affordable, though the framework does allow for this target to be variable.

SFHA’s research found that the effectiveness and use of the agreements varied significantly by regions and local authorities.

The research studied how the agreements were working in four case study areas; Aberdeen, Dumfries and Galloway, Edinburgh, and Fife.

For example, in Dumfries and Galloway, where there is less private development, it is harder to maintain an affordable housing requirement as part of a Section 75 Agreement. Whereas in Edinburgh, which has typically high land values, house prices and average rents, its Section 75 Agreements has had more success in increasing the supply of affordable housing in an expensive market.

Across all study regions, the research found that when housing associations were involved too late in the Section 75 Agreement process, they had limited influence on the type of homes which could be delivered, such as larger family homes or specialist accessible homes.

The research also highlighted concerns that wider development contributions, which are sums developers provide to councils for the impact of housing on demand for other services such as schools and roads, has meant funding earmarked for affordable housing is being diverted to other areas.

It also found that the lack of a Mortgage Exclusion Clause within Section 75 Agreements is impacting the borrowing capacity of housing associations and potentially limiting affordable housing delivery.

SFHA said the research underlined the importance of public grant funding available to housing associations under the Affordable Housing Supply Programme but said funding had to be better managed and guaranteed long-term.

SFHA chief executive Richard Meade said: “With Section 75 Agreements delivering up to a third of all affordable homes built in Scotland each year, it’s essential these agreements are working as intended to deliver the safe, warm, affordable homes we need.

“Too often housing associations are brought in late to the development process. This is causing developments to either stall, or it means we risk losing opportunities to build homes appropriate for local needs, such as family-sized homes or specialist accessible housing. In some cases, housing associations are scaling back on this type of delivery.

“Whilst developer contributions do vary across Scotland, we are supportive of agreements tailored to local needs. However, what is clear in every area of Scotland is that building any type of housing is dependent on substantial and long-term public investment in social and affordable housing.”

Dr John Boyle, director of research and strategy at Rettie & Co, said: “Affordable housing contributions policies seem to work well across Scotland, but have most impact in higher value areas where land values can support these contributions. The vast majority of such housing delivered is for social rent and the quality of the housing is generally considered to be good.

“However, improvements could be made to enhance delivery, particularly by involving RSLs sooner in the drawing up of Section 75 Agreements and in ensuring that grant funding is effectively organised and long-term. The whole contributions system is heavily dependent on this funding.”