Scottish housebuilding 'may never recover from crisis'

Gerry More, who is also a director of Cala Group, said Scotland will be unable to retain skilled employees following a near 50 per cent collapse in the number of new-build homes to 11,000 per year.

He said the dearth of new housebuilding also threatened to wipe out Scotland's stock of small and medium-sized developers, creating a "lost generation" of skilled tradesmen.

This would mean housebuilding in Scotland would be carried out by only the largest and best-capitalised housebuilders when the market picks up.

HFS, which represents some 200 home building and associate member companies, estimates that Scotland has already lost hundreds of homebuilding firms.

More said: "If you don't have a properly structured housing industry as a national priority, companies won't locate here, in fact they will relocate away.

"The small and niche medium developers - they might disappear out of the sector and they are unlikely to come back. There is a need to bridge that gap or we will be dominated by large-volume developers."

More urged the Scottish Government to delay payments, through Section 75 agreements, made to councils for infrastructure works on new housing developments. He has also called for the simplification of regulation on environmental standards and an extension of equity support schemes.

Alex Neil, Scottish housing and communities minister, said: "The Scottish Government has acted decisively to boost the supply of affordable housing, ploughing in record levels of funding - more than 1.7 billion over three years. In addition, we have launched a New Supply Shared Equity with Developers trial and are taking forward a National Housing Trust initiative, which aims to support around 1,000 new affordable homes for intermediate rent.

"This investment will help safeguard jobs, support the construction industry and keep the Scottish economy moving."