How Scotland's house prices risk becoming as unaffordable as during Victorian era
Amid housing emergency, the Scottish Government must consider bold reforms to planning system
In Scotland, the average home now costs more than five times the average annual salary. However, as recently as 2003, the figure was less than four times typical pay. So it is no surprise that those trying to get on the housing ladder are finding it increasingly hard to take that all-important first step.
Their situation is compounded by the fact that rents have been rising sharply, reducing their ability to save for a deposit. And then there are people who struggle to afford to pay high rents and find themselves either homeless or effectively forced to live in ‘temporary’ accommodation for long periods.
So it’s no surprise that the issue has been moving to the top of the political agenda, with Scotland declaring a housing emergency last year. If housing costs keep rising, we could face a return to the 19th century, when average UK house prices ranged between eight and 12 times the average salary.
Thousands of affordable homes
The Scottish Government plans to spend up to £4.9 billion on affordable homes over the next four years, with Housing Secretary Màiri McAllan saying ”this long-term certainty and increase in funding will support a significant increase in delivery of around 36,000 affordable homes”.
This is a sizable sum of money, but a new report commissioned by the Chartered Institute of Housing Scotland, Shelter Scotland, and the Scottish Federation of Housing Associations – a credible coalition – estimated that some £8.2bn would be needed over the next five years to build the social and affordable homes that Scotland needs.
Alarmingly, in 2024/25, work started on the lowest number of new-build properties in Scotland in ten years, apart from 2020/21 when the Covid pandemic caused major disruption. There appears to be widespread agreement that the planning system is part of the problem.
A society worthy of the name
Council cutbacks mean that a system designed for another era is now creaking at the seams, with too few staff in planning departments to process applications sufficiently quickly, causing real problems for developers.
Bold, emergency reforms should now be considered. It makes no sense to maintain a gold-plated system on paper if we can only afford a tin one, particularly if this is contributing to the lack of much-needed housing.
No society worthy of the name should tolerate homelessness. We all need a place of our own and our government needs to do whatever it takes to make that happen.
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