This report presents the findings from research conducted in 2019 which sought to estimate the need for affordable housing in Scotland between 2021 and 2026. The research was commissioned by the Scottish Federation of Housing Associations (SFHA), Shelter Scotland and the Chartered Institute of Housing (CIH) Scotland. The study updates a previous, similar exercise conducted in 2015 by the research team. The  COVID-19 virus has had a profound immediate impact on the role of housing in the lives of Scotland’s population.

The increase in Scotland’s funding for affordable housing supply between 2015 and 2020 is having an impact in reducing housing need. However, with 10,600 dwellings required per annum to deal with the backlog and newly arising need between 2021 and 2026, continuation at this level of subsidy in ‘real’ terms is required.  A mixture of affordable housing products will be required to meet this housing need. This mix will need to be tailored to local geographies and housing needs. As such the overall capital budget will need to reflect this mixed type of subsidy by tenure type, size and geography. The increases in the Grant Subsidy Benchmarks are welcome but will need to be updated regularly to reflect changing costs. We estimate that the Affordable Housing Supply Programme will need in the region of £3.4 billion to finance the necessary new stock that is required between 2021 and 2026. This is in addition to any necessary funding to maintain the existing stock. The changing demographic profile in Scotland will require increased subsidies directed towards older people’s housing.

This will need to support both new housing delivery and enable households to stay in their existing dwellings through adaptations, where this is suitable. The delivery of housing has increased in Scotland in the last couple of years and it is widely recognized that there is an ongoing need to support a skilled construction workforce. Brexit, as well as other issues, may result in loss of skilled labour – the Scottish Government will need to monitor the construction workforce and continue to work with developers to ensure rising costs do not inhibit housing delivery.