Professional briefing - The Journal Online

New house builds
Another big impact of the recession was
felt by the house-building industry,
which had to curtail many new
developments across Scotland. Homes
for Scotland estimates that 46,800
direct and indirect jobs have been lost
in the industry since May 2008 and this
could be a skills issue for the future.
New-build houses totalled 16,273
during 2009, 29% lower than the
number built in 2008, and 39% below
that started in 2007.
However, confidence in the new
house market remains where prime
sites are being developed. National
House-Building Council statistics
show that 1,987 new homes were
registered between January and March
2010, a 37% increase over the same
period in 2009.
David Knight, Managing Director of
Miller Homes in Scotland – the largest
in the Edinburgh prime market
herald a recovery for Scottish
property as a whole.
In its new Scottish Property
Market Research report covering
the first quarter of 2010, it
foresees Edinburgh’s equity-rich
homebuyers leading the Scottish
market out of the doldrums.
Savills’ Research Director
Lucian Cook said history is
repeating itself: “In the mid to
The Scottish farm market was
kept buoyant in recent years by
Ireland’s appetite for farming,
fuelled by the country’s
booming economy, but this
interest has since waned.
However, with little on the
market at present, prices have
held up. The same goes for rural
housing as the increase in
purchases of holiday homes over
the past few decades has
reduced supply, particularly on
the west coast and on the
islands – much to the chagrin of
local people trying to get on the
property ladder.
The recent Government push
behind the development of
renewable energy in Scotland
has also had a positive effect
on land prices, particularly with
the introduction of feed-in
tariffs to allow landowners to
sell surplus power back to the
grid. This has led to speculative
acquisitions and sell-offs of
www.lawscotjobs.co.uk
independent home builder in Scotland
and recently crowned House Builder of
the Year in the Scottish Homes Awards
– has confidence in the future. “The
fundamentals are still there for new
properties that are well located, but we
are having to adapt to a much lower
level of demand.”
Knight said the new environment has
also led to a new model of funding land
purchases, with house builders and
landowners coming to a mutual
understanding about creating a
sustainable future in this sector.
He explained: “In this current economic
climate, landowners are now prepared to
take a range of part-payment deals and
final payments on completion of sales of
properties. This means they are now
having to share some of the risks which,
until now, had been totally shouldered
by house builders.”
late-1990s, the prime Edinburgh
market led the recovery, and with
values rising 6.6% in the
last six months, according to
Scottish prime indices, a similar
pattern seems to be emerging.”
The report explained that
London prices are usually the
first to recover following a
recession, with the effects being
Continued overleaf >
land with exposure to high
winds, good access and
located near existing grid
connections. The Government’s
go-ahead for the Beauly-Denny
upgrade will also give a
premium to suitable land as its
power line develops.
Access to funding has been
less restricted in the rural
property market compared to
the residential market, as the
main banking specialists in
this field include the Co-op
Bank and Clydesdale Bank,
whose more conservative
approach to banking has left
them relatively unaffected by
the “casino” antics of their
larger competitors.
However, two areas that have
dried up because of finance
and lack of demand are the
development of steadings for
residential or business premises
and the selling of land for new
housing developments.
July 2010 theJournal / 55