Housebuilding in Scotland hits lowest level for 30 years

Housebuilding in Scotland has slumped to its lowest level in almost 30 years after a collapse in the construction of private homes.

New figures show the number of houses built last year was 16,852 - the lowest level since 1982 - with the number of new private properties falling by almost half in just five years.

The number of new public sector and housing association homes also fell by almost 10 per cent last year.

Economists have warned that the collapse in the housebuilding market could mean increased strain on new families, who will find it harder to buy their first properties.

Martin Ellis, head of housing economics at Lloyds Banking Group, said: "Housebuilding levels have fallen sharply. If this continues, housing supply will fail to match the pace at which new households are likely to be formed. This would put upward pressure on house prices over the medium to longer term, making it more difficult for young people to buy their first home."

The number of private sector homes completed in Scotland last year was 11,178, a massive reduction from the 21,674 finished in 2007. The number of public sector and housing association homes ready to be moved into fell to 5,674, down from 6,261 the previous year.

Work started on 1,273 council houses last year, but housing charities said the Scottish Government was unlikely to fulfil promises to build 6,000 new council houses this year.

Mary Taylor, chief executive of the Scottish Federation of Housing Associations, said: "These worrying figures show what lies ahead if action is not taken by the Scottish Government to restore spending after the massive cuts which affordable housebuilding has sustained in the last year.

"They show the Scottish Government's own target to build 6,000 new affordable homes this year is looking doubtful."

Experts said yesterday that the market continued to be attractive to buyers, with almost a third more properties on the market than normal, but warned that the situation could get worse over the next decade if building problems continue.

Labour hit out at the statistics, saying they showed that the SNP was not taking problems in the housing sector seriously.

Capital investment spokesman Lewis Macdonald MSP said: "The fact that the housing and regeneration budget has been one of the biggest losers in successive SNP budgets is very telling. With the number of new housing being started, things are likely to get worse before they get better."Alex Neil, the Scottish Government's new infrastructure and capital investment secretary, said: "These are difficult times for Scotland's housing system and we sympathise with any homeowners who face serious challenges in selling their properties.

"The Scottish Government is doing all it can by investing millions to social landlords and others to help them build affordable homes and also assistance to help people onto the housing ladder."