Homes for Scotland’s anti-social housebuilding agenda “out of touch with reality”

Property developer model caused the housing crisis and can't fix it

THE anti-social housebuilding agenda of the property developer lobby is “out of touch with reality” and must be “rejected outright” by the Scottish Government, the Common Weal think-tank has argued.

Nicola Barclay, chief executive of property developer lobby group Homes for Scotland, commented in the Times that social housing "will not solve Scotland's housing crisis".

Responding, Ben Wray, head of policy at Common Weal and author of recent report on Scotland’s private rented sector, stated: “When even Conservative minister’s in the UK Government are saying that to solve the housing crisis we need to borrow more to build social housing, Homes for Scotland’s attempt to stymie social housebuilding in Scotland appear totally out of touch with reality.

“Since Homes for Scotland offer no clear policy solutions, it can only be assumed that this attack on social housebuilding is aggressive lobbying to extract yet more subsidies for private developers. Considering only last week the Scottish Government announced a new subsidy for private sector build-to-rent housing in partnership Homes for Scotland – on top of the huge subsidy they already get through housing benefit - it is quite remarkable that they are back for more so soon after.

“Any attempt to further privatise the housing market must be rejected outright by the Scottish Government. Not only is the dominance of the profit-motive in housing the major force behind the financial crisis in 2008, it is also the very reason why more affordable housing is not being built by the private sector, as rising property prices and land values make it more profitable to sit on land than to build on it. ONS data shows average house prices in Scotland hit their highest level ever in September 2017, rising above the previous pre-recession peak.

“The property developer model is what created the housing crisis – it would be madness to believe it can solve it as well.”

“Not only is the dominance of the profit-motive in housing the major force behind the financial crisis in 2008, it is also the very reason why more affordable housing is not being built by the private sector, as rising property prices and land values make it more profitable to sit on land than to build on it.” Ben Wray

Common Weal held a sold-out 300 person convention on housing earlier this month (pictures below), advocating a public-sector led solution to address the housing crisis. Policies proposed included changes to tax to bring down the value of land and property, a land value capture policy as a new financial model for public housebuilding and compulsory sales orders to make use of Scotland’s vacant and derelict land for housebuilding.

Commenting, Common Weal Director Robin McAlpine stated: “I fear it’s the big property developers who need to face reality. The UK housing market has serious problems and it is the developers’ desire to always inflate prices to maximise profit that lies at the heart of much of these problems. It is telling that they are lobbying against safe and secure high quality public rental housing which would put the interests of tenants above the interests of shareholders.”

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