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Housing minister warns of Brexit’s threat to Scotland’s housing ambition

A “no deal” exit from the EU has potential to cause serious problems for Scotland’s housing sector, housing minister Kevin Stewart has warned.

In a letter to housing organisations and stakeholders due to issue this week, Mr Stewart will highlight the potential adverse consequences of Brexit including:

  • Hurting investor confidence in residential assets and build to rent market
  • Inflation and interest rate fluctuation affecting rents, the financial health of Registered Social Landlords (RSLs) and the availability and cost of finance for new build homes
  • Reduced availability and increased costs of house-building materials such as timber, prefabricated concrete and boilers from non-tariff and tariff barriers
  • Impact on the availability of EU nationals working in the construction and housebuilding sector, as well as housing support services

Speaking ahead of Scotland’s Housing Festival 2019 tomorrow, Mr Stewart said: “The UK’s exit from the EU has the potential to impact the housing sector in Scotland and therefore our housing ambitions. As we strive to provide stability and certainty, our efforts are being compromised by the UK Government’s failure to acknowledge our concerns or discuss compromise alternatives.

“Some 60% of the UK’s building material imports come from the EU and we have a particular reliance in Scotland on imported timber for housebuilding. Many of those employed across the housing sector are EU nationals. The extent to which we depend on EU relations cannot and should not be underestimated.

“We are committed to delivering more affordable homes and are on track to deliver our ambitious 50,000 affordable homes target by 2021, backed by our investment of over £3 billion. We are also investing in energy efficiency improvements to existing homes, making them warmer and cheaper to heat.

“We must not allow the UK Government’s approach to Brexit jeopardise these commitments which also supports our aims to end homelessness, and reduce fuel poverty.

“We will continue to work with the housing sector on Brexit-related risks – with construction, housebuilding and mortgage lending industries in Scotland, as well as through the Joint Housing Policy and Delivery Group.”

Scotland’s Housing Festival 2019 takes place in Glasgow on 12-13 March.

In 2018, the Scottish Government commissioned an analysis of the construction and housebuilding industry in Scotland to understand specific Scottish risks on housing demand, materials and workforce.

Source: Scottish Housing News

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Scotland’s housing market ‘bucking the trend’ as average cost of a home hits new high

Scotland’s housing market is in a good position to face any challenges that lie ahead, experts said as the average cost of a home hit a new high.

The latest House Price Index by Your Move/Acadata found the average price in Scotland stood at a new peak of £184,569 in October.

Annual price growth that month rose to 5.5% when compared with the same point in 2017, the highest rate since April.

The growth rate was five times the average price growth of 1.1% seen in England and Wales in October.

Alan Penman, of chartered surveyors Walker Fraser Steele, said: “Despite any uncertainty surrounding Brexit, the Scottish market could hardly hope for a better position from which to face whatever challenges the next few months bring.”

The index attributed the rise to a general gradual increase over the last three years, and “a turnaround that has seen a return to monthly increases after falling prices during the summer”.

Edinburgh and Glasgow were described as contributing significantly to the overall figures in Scotland.

In the capital, prices were up around 10% on the same time a year ago to £285,077, while Glasgow witnessed a yearly jump of around 9% to £164,689.
Overall, 26 of Scotland’s 32 local authorities saw prices rise over the year, with East Dunbartonshire, Argyll and Bute, Angus, Clackmannanshire and the Western Isles among those said to be showing “real strength”.

The report stated: “Despite a context of relatively few transactions, five local authority areas in Scotland still saw annual house price growth of over 10% in October.

“For comparison, only one local authority area in England saw price growth of over 10% in the same month.

“Despite the growth, the market is not entirely immune to Brexit uncertainty. While much of the increase in prices is supported by low mortgage rates, good wage growth and high employment, it is also due to short supply.

“Buyer demand is strong, but uncertainty means sellers are in no hurry to put their properties on the market.”

Christine Campbell, Your Move managing director in Scotland, said: “Setting a new peak average price at a time when many parts of the UK are struggling to maintain prices is a significant show of strength from the Scottish market. Scotland continues to defy the pessimists.”

Source: Herald Scotland