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Scots housing market outlook bright amid Brexit clouds says sector leader

DEMAND for new homes will remain strong in Scotland for years in spite of the uncertainty around Brexit the head of an influential sector player has predicted.

Richard Jennings, who heads Places for People’s operations in Scotland, said a range of factors will underpin demand for homes in Scotland where the organisation thinks the potential for growth is significant.

Places for People expects to lead on investment in affordable housing worth more than £300 million in coming years as it responds to factors such as the ageing population, growing numbers of people living alone and strong inward migration.

The organisation, which does not distribute dividends, operates in the social economy in Scotland through operations such as affordable housing heavyweight Castle Rock Edinvar. It also develops homes for sale in the wider commercial market.

Uncertainty about Brexit may be impacting on decision making among businesses but Places for People has not seen any sign the housing market is cooling.

“We’re not seeing any drop off in demand for housing,” said Mr Jennings, who noted a range of housebuilders have remained bullish about the Scottish market in recent months.

“Scotland will always attract inward migration, especially cities like Edinburgh because of its offer,” he predicted.

Mr Jennings said the quality of life on offer in the Edinburgh area and the strength of the employment market help give it enduring appeal, adding: “Glasgow is no different.”

He noted that Barclays had provided a major vote of confidence in Glasgow last year by announcing plans to develop a new hub on the banks of the Clyde that will house around 5,500 staff.

Other big employers are choosing Glasgow as a great place to invest. The availability of a skilled workforce combined with the fact the city has a very high retention rate for graduates, is helping to attract companies that are creating jobs.

“They’re all looking for somewhere to live, right across the spectrum. They’re not all going to settle down in the suburbs,” observed Mr Jennings, of the employees concerned.

Regarding the potential impact of Brexit on the flows of people, Mr Jennings said: “To meet the demands of the service and technology sectors and the care sector we’re going to need mechanisms to support inward migration.”

While there might be some short term flux, he is confident that politicians will find a solution although some champions of Brexit want to curb migration from EU countries.

With around 300 direct employees in Scotland, Places for People expects to play a key role in helping to meet the official target to build 50,000 affordable homes by 2021.

This will include Castle Rock Edinvar building 2,000 units years under a £150m programme.

Places for People also expects to raise £100m funding from the private sector to help build a further 1,000 units with the support of a £45m government loan.

Mr Jennings highlighted the role played by the Scottish Government in supporting investment in the sector in recent years.

He noted Places for People has developed strong expertise in the raising of funding for developments from private sector players through its fund management arm (PfP Capital).

The organisation has also acquired skills that allow it to play a part across the cycle, from designing new properties and communities in response to changing social needs to managing existing homes.

It is not just interested in growth for growth’s sake according to Mr Jennings, who said: “It’s about producing the rights types of homes in the right places and the right management support. We’re growing in numbers and our understanding.”

Places for People is marketing a range of developments across the UK. Its offer includes homes to rent or buy, retirement housing, supported living schemes and student accommodation.

Scottish projects include Tornagrain near Inverness, which is billed as the Highlands’ newest town. In Edinburgh Places for People is developing homes to buy and rent on the site of the former tram depot on Leith Walk.

Mr Jennings is enjoying working for Places for People after completing successful spells in both the private and public sectors.

Private sector work included management consulting at accountancy giant’s PwC and KPMG. In the public sector he was on the fast stream programme at the Scottish Government before going on to head the education and housing departments at East Lothian Council. The move to Places for People came in 2014, when Mr Jennings became head of property for Castle Rock Edinvar.

“I always find it’s not so much the sector it’s who’s helping to make change happen,” said Mr Jennings, who distinguished himself as a student by winning a Commonwealth scholarship to do doctoral studies in geomorphology in New Zealand.

“If you’re a geomorphologist New Zealand is like this little playground but it’s also a fantastic place to live,” observed Mr Jennings, who got his first degree, in geography from the University of Glasgow.

He has no regrets about deciding to leave academia.

“You’ve got the excitement of research and exploring ideas but the challenge for academics is that a lot of their time is taken up with navigating the bureaucracy of funding of meeting demands to be published. You’re spoiled as a student with the luxury of research and exploring new ideas.”

A native of the port city of Plymouth, Mr Jennings is very happy living in Scotland where he can indulge passions which include surfing at scenic spots on the east coast.

By Mark Williamson

Source: Herald Scotland