News article 11/03/2013

(Issued 11 March 2013) 
 

With a projected shortfall of 150,000 new homes out of the 450,000 it is estimated are required to help meet household formation and population growth in Scotland over the next 20 years¹, Scottish home building industry leaders today demanded that the Chancellor implement further bold measures in next week’s Budget to stimulate the still fragile UK housing market and wider economy.

Speaking after a meeting of trade body Homes for Scotland’s Board, which comprises 22 key industry figures, Chairman Andy Pearson, who is also Managing Director of Borders-based Tweed Homes said:

“The home building industry has been particularly harshly affected by the economic downturn, with current production levels at their lowest since the Second World War. Whilst housing is a devolved issue, the Westminster Government still has important tools available to it which have the potential to make a significant impact on recovery right across the UK.

“For example, evidence suggests that the Funding for Lending initiative is beginning to make positive steps in relation to mortgage availability and interest rates, but there remain concerns that the benefits of the scheme are not reaching the vital First Time Buyer market and those with lower levels of equity or deposits.

“We would therefore like to see action which encourages lenders to target the benefits of Funding for Lending to these particular groups as well as having the initiative extended beyond January 2014. A stamp duty holiday on all purchases would also relieve a significant burden on would-be home buyers with any loss of tax revenue compensated by increased transactions, home building activity and job creation.

“Allowing residential investment in SIPPS would also bring immediate new sources of funding for the development of homes at no cost to the Treasury and we therefore propose consideration be given to enabling £1 to be borrowed for every £1 held in a fund.

“With the far-reaching social, economic and environmental benefits associated with the delivery of new homes well recognised, these are just a few examples of the types of areas which could have a significant impact not only on our industry but also the wider UK economy as a whole.”

Ends

Notes to editors:

1. Extrapolated from Household Projections for Scotland 2010 based, National Records for Scotland (http://www.gro-scotland.gov.uk/statistics/theme/households/projections/2010-based/index.html) and Housing Statistics for Scotland – All sector new build (http://www.scotland.gov.uk/Topics/Statistics/Browse/Housing-Regeneration/HSfS/NewBuildAllSector)