Housing professionals disappointed with Scottish Budget

The Scottish Budget has been poorly received by housing professionals, who argue there should have been more support for green housing and a review of Land and Buildings Transaction tax.

Funding for housing has been cut from £564.4 million in this financial year to £375.8 million in the next one.

What was announced was £90 million in discretionary housing payments (for councils needing extra help), £35 million to end homelessness and reduce the numbers of people in temporary accommodation, while 358 million will be invested in energy efficiency and clean homes.

Shona Robison, finance minister, said: “Affordable housing is a key area for supporting many to find a home.

“That’s why we will invest £550 million in the supply programme helping to deliver homes for social rent, mid-market rent and low-cost home ownership in communities across Scotland.”

In November Edinburgh councils declared the current situation a housing emergency, due to demand significantly outstripping supply.

Timothy Douglas, head of policy and campaigns at Propertymark, said: “There is a huge demand crisis in the private rented sector that the Scottish government is failing to address.

“Scotland remains the most expensive place to invest in the private rented sector across the UK and we need to see more support through grant funding to help agents and their landlords to improve the energy efficiency of homes.

“The cost-of-living legislation has raised costs for renters and it’s now imperative that the Scottish government carry out a review of all taxes impacting private landlords and the wider property sector in order to introduce policies that help meet the demand from renters and tackle the housing emergency.”

David Alexander, chief executive of DJ Alexander Ltd, said: “The Scottish budget was a missed opportunity to address some of the key issues affecting the housing sector in Scotland.

“There is to be a £550m investment in the supply programme for rent, social rent and affordable home ownership but given the scale of demand and the waiting list for social housing this, although a large amount of money, is still not sufficient to address the issue.

“In many local council areas, the wait for social housing is measured in years and sometimes in decades. This is an issue requiring sustained major investment over a prolonged period and the current announcement is welcome but clearly not going to meet demand in the next five to ten years.”

“There is no change to Land and Buildings Transaction Tax (LBTT) which makes Scotland much more expensive to buy property at a very early stage. First time buyers are more punitively hit than anywhere else in the UK with tax starting at £175,000 compared to £425,000 in England and Wales. While any property over £325,001 attracts a 10% charge which doesn’t occur south of the Border until properties cost more than £925,000.”

Alexander added: “There is an additional £358m provided to accelerate the installation of clean heating systems but given that this represents just over 1% of the anticipated £33bn costs of the implementation of these energy efficient products it is clear that the homeowner is still being asked to stump up for the Scottish government’s green ambitions.

“With higher personal taxes than anywhere else in the UK and higher house purchase costs it is hard to see how these policies make Scotland an attractive place to live and work. This budget was an opportunity to encourage more housebuilding, to address serious shortages in the number of social housing available, and to attract higher earners to live and work here. Unfortunately, I think that it has been a missed opportunity on all counts.”

Alex Cole-Hamilton, leader of the Scottish Lib Dems, criticised the SNP in parliament for not having a long-term economic strategy, asking how the housing budget can be cut during a housing emergency.