Signs of upturn in housing as planning applications rise

Published on Wednesday 24 June 2009 10:22

THE number of planning applications lodged in the Capital has increased for five consecutive months.

Experts say it is the first sign of growing enthusiasm for development in the city.

A total of 456 planning applications were lodged with city planners in May, compared to 351 in April. It is thought that the majority of the applications have been related to housing, or home improvements.

Separate data from the National House Building Council (NHBC) also indicates that the number of homes being built has started to increase compared to late last year. In the first three months of the year, 194 homes were built, compared to 93 in the last three months of 2008 and 90 in quarter three of last year.

Councillor Paul Edie, the city's housing leader, said: "We desperately need people to start building because we need the housing and we need the income and expenditure that you get from people working in the building trade."

Despite the month-on-month increases in planning applications, the council data shows that the number of applications in May was still down by nearly a quarter on the 592 lodged in May 2008.

Of those that were lodged, council officials noted that many were for smaller developments like "alterations, improvements and extensions".

And Cameron Stott, an Edinburgh-based director of property firm Jones Lang LaSalle, said that few of the new applications will have been for commercial development.

He said: "Development numbers are still very low. There are still the issues with funding for developers and there is a shortage of demand from companies to occupy any new space."

He added: "My view would be that the increase would be mostly smaller scale development and a very large proportion will be residential. It might well be that it is people who would have looked to move up the housing ladder in the past but are instead not selling and working on their existing house."

The NHBC data, which is based on information on new homes from 80 per cent of UK housebuilders, shows that in the three months to the end of May, 79 per cent fewer homes were registered in Edinburgh than had been in the same period a year earlier.

Jonathan Fair, chief executive of Homes For Scotland, also said more needed to be done to start to improve the year-on-year figures.

He said: "Whilst buyers may be showing increasing levels of interest in purchasing new homes as they contemplate the bottom of the market, the big stumbling block remains the overall availability of mortgage finance."