Scotland’s housing crisis is a ticking time bomb

From a lack of affordable homes to rising rents, Scotland is facing a housing crisis that affects everyone.

Growing numbers of businesses cannot open due to a lack of staff, whilst 30,000 people in Scotland are stuck on social housing lists waiting for a home.

Landlords in Scotland are leaving the sector in their droves due to unpopular legislation introduced by the Scottish government which does nothing to help stop the housing crisis.

This Property118 investigation highlights how a lack of housing is causing a huge headache for people across Scotland and employers are struggling to recruit because of a lack of affordable homes.

68% of businesses in the Highlands struggling to recruit staff

In a programme on BBC Radio 4 called All work and no homes, businesses in the Scottish Highlands face a real struggle to recruit new staff due to a lack of affordable homes in the region.

A survey conducted by the Chamber of Commerce in Scotland found two in three businesses (68%) in the Highlands state the lack of affordable housing has affected their ability to recruit new staff.

More than half of the businesses (59%) expected the issues to worsen if no action was taken by the Scottish government.

The findings reveal there are currently 180 vacancies in Badenoch and Strathspey listed on the Indeed website. Survey results suggest that around half of these will not be filled due to a shortage of suitable homes.

Convenor of the Highland Council, Bill Lobban, said: “The biggest issue facing our community is the provision of affordable housing.”

Mr Lobban said there needs to be a balance between accommodation for tourists and local people.

He said: “Our economy is almost exclusively tourism-based, so we do need accommodation for tourists, but we also desperately need homes for the local people who live and work here, many of whom serve the tourists who come in their droves.”

He added: “There has to be a balance and currently that balance has shifted far too far away from the provision of affordable housing, and we must redress that balance as a matter of urgency.”

Between 1,300-1,700, job vacancies are unfilled

In Ullapool, many pubs and hotels have had to close their doors altogether due to a lack of affordable accommodation for staff in the local community.

In 2021, the Lochbroom and Ullapool community trust conducted a survey identifying housing as the most urgent issue in the local community.

Brendan O’Hanrahan, a Trust director, told the Radio 4 programme: “We have people living in the community who have various problems with overcrowding, housing which is substandard, and we have even heard stories of people living on somebody’s couch and all these people are saying there needs to be more affordable housing.”

In a study commissioned by the Highlands and Islands Enterprise and Lochalsh & Skye Housing Association, businesses in the area are struggling to recruit staff.

The findings reveal between 1,300 and 1,700 job vacancies are currently unfilled because of the lack of accommodation in Skye and Lochalsh.

Of the businesses surveyed, 29% said they have offered a job to an individual who has decided not to take the role with accommodation issues mentioned in 50% of these cases.

The survey concluded that the housing shortage is having a huge impact on the local economy.

John Blackwood, the chief executive of the Scottish Association of Landlords (SAL), said: “A lack of available housing is too often thought of as a problem for cities, but it is a massive problem in rural areas of Scotland as well.

“Like cities, a lack of high-quality and flexible housing has knock-on effects that impact on the local community and economy.”

He added: “That is why we need a proper long-term plan that brings together all parts of the housing sector to make sure we develop a solution that works in different areas and encourages investment in different types of homes across Scotland.”

The question is, could this situation extend to other home nations?

In a survey conducted by the London Business Survey in 2018, two-thirds (66%) of employers in London were struggling to recruit entry-level staff due to a lack of affordable homes in the capital.

Similarly, in the South-West employers are struggling to recruit staff as waiting list figures soar.

Cornwall Council revealed that in March 2020 there were just over 9,000 households on its Homechoice Register, but by January 2022 that had jumped to 21,200 households – an increase of 126%.

The latest figures for May 2022 show there are now 22,423 households registered for housing.

In 2021, Cornwall’s main hospital trust warned that nurses were finding it more difficult to find places to live due to a lack of affordable homes in the area.

In a letter to the council, Roberta Fuller, head of hospital reconfiguration at Royal Cornwall Hospitals Trust, explained how the shortage of accommodation was affecting staff during the pandemic.

She wrote: “The additional strain of seeking, securing, and retaining a place to live is certainly impacting our local workforce.

“In addition, long-distance ‘weekly commuters’ from Devon and beyond are starting to struggle to find short-term accommodation to continue to work at the trust without relocating fully.”

She added: “The housing problem is not only one of finding affordable housing for students and younger member of the workforce; many of our skilled and trained medical and nursing staff are in mid-life with children, pets, and extended families to consider.

“Finding affordable long-term family accommodation has become even more difficult since the pandemic and rising house prices.”

‘If the Scottish Government continue with policies that disincentive landlords this will only make the situation worse’

The private rented sector is a key solution to help tackle the housing crisis in Scotland, however, the government seem to be introducing legislation which will do nothing to stop the crisis.

The Scottish government had introduced a rent freeze for the private rented sector which is now a 3% rent cap in place until 30 September, and there is a limited ban on repossessions until the same date.

On the Scottish government website, it states: “Private landlords will alternatively be able to apply for a rent increase of up to 6% to help cover certain increases in costs in defined and limited circumstances.”

This is on top of regulations being introduced to have all privately rented properties in Scotland reach an EPC rating of C by 2025.

It is no wonder many landlords in Scotland are leaving the PRS. In a survey conducted by Propertymark, 85% of agents reported that landlords in Scotland have expressed a wish to sell their properties.

Timothy Douglas, Propertymark’s head of policy and campaigns, said: “Feedback from Propertymark members shows that because of the measures introduced by the Scottish government, the desire for landlords to remain in the sector and increase the number of homes for people to rent is stalling.”

He added: “The private rented sector is a key solution to resolve the housing crisis but if the Scottish Government continue with policies that disincentive landlords this will only make the situation worse.”

Harder to solve Scotland’s housing crisis

In recent weeks, a campaign to challenge policies that are damaging the private rented sector in Scotland has been launched by a coalition of organisations from across the UK’s private rented sector.

They are seeking to prevent the measures from being extended beyond the legal cut-off date of 20th September 2023.

The campaign group includes the Scottish Association of Landlords (SAL), the National Residential Landlords Association (NRLA), PropertyMark and Scottish Land and Estates (SLE).

Mr Blackwood, from SAL, said: “Over the years we have been able to work constructively with the Scottish government and, as a result, have secured changes which have improved the private rented sector in Scotland.

“However, arbitrary rent freezes and eviction bans discriminate against private landlords, reduce investment and harm both landlords and tenants, while making it harder to solve Scotland’s housing crisis.”

He added: “With pressure being placed on landlords by governments throughout the UK, now more than ever, landlords all over the country need to work together in ensuring our voice is heard.”

£25 million for affordable homes

Humza Yousaf delivered his New Leadership, A Fresh Start for Scotland speech on Tuesday this week in which he said housing is a top priority.

Mr Yousaf said: “We will publish an action plan for housing in remote, rural and island areas.

“This plan will include up to £25 million from our affordable homes budget to allow suitable properties, including empty houses, to be purchased or long-leased, and turned into affordable homes for key workers and others.”

A Scottish government spokesperson told Property118: “Between 2018-22, Scotland has seen 59% more affordable homes delivered per head of population than in England and over nine times as many social rented homes per head of population.

“We are now working to deliver on our target of 110,000 affordable homes by 2032, of which at least 70% will be available for social rent and 10% will be in our remote, rural and island communities.”

A ticking time bomb

Scotland’s housing crisis is a ticking time bomb that will slowly but surely get worse as time goes on.

Legislation by the Scottish government for landlords has proved to be controversial without actually solving the housing crisis in Scotland and it remains to be seen if it ever will.

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