Scotland's housing sector has a challenge on its hands. At a time of planning reform, eviction freezes in the social housing sector and rent freezes in the private housing sector, together with rises in inflation and mortgage costs, much needs to be done to ensure sufficient levels of good quality, sustainable and affordable homes.

Earlier this year, Brodies gathered key figures in the living sector to discuss the challenges and opportunities for housing in Scotland's main cities and regions. Common themes included planning, social and affordable housing, and sustainable development. There were also nuances for each region. Within the Highlands and Islands, where remote communities are facing depopulation issues, housing plays a central role in reversing that trend and driving economic growth.

There are opportunities to be exploited in responding to changing circumstances that arise through major projects and funding. Examples include the ScotWind leasing bid and the Inverness and Cromarty Firth's (ICF) successful bid for Green Freeport status, as well as the £100 million of investment earmarked for Orkney, Shetland and the Outer Hebrides via the Islands Growth Deal. But these projects may bring their own challenges by increasing pressure on existing infrastructure, with a knock-on effect for new housing developments.

However, they also have the potential to attract and retain a talented workforce. One possible solution would be to encourage developers to invest in and build homes in advance of such projects coming on stream, but at a time when there is sufficient certainty around delivery. This would require both central and local government to work closely with developers to convince them of the advantages of such an approach.

While the delivery of affordable homes is a priority Scotland-wide, in the Highlands and Islands it is also key to population growth. Rather than having a single solution for all regions, towns and cities, the answer may lie in strengthened local decision-making in which factors like population density, demographic and employment trends can be assessed to help develop approaches better suited to individual communities.

Allocation of funding may also benefit from decision-making at a local level. £25 million is to be spent via the Scottish Government's Affordable Housing Supply Programme, which includes enabling suitable properties such as empty homes, to be made available to key workers in remote, rural and island communities. Local knowledge can help determine who, or what qualifies as 'key' and help ensure funding is used to best serve the needs of local communities.

Addressing the housing challenge involves working out what resonates with homeowners and tenants when deciding to relocate. A home is unlikely to be enough. People want to live in communities that provide for adequate educational and health services, as well as facilities to accommodate retail and leisure needs. Delivering this type of placemaking will require collaboration between planners, developers, government and other stakeholders.

One example is Tornagrain, near to Inverness Airport. A 50-year development that will ultimately become a new town, the initial build phase includes a grocery store, pharmacy, nursery, cafe, community hub and allotments.

There is no 'one-size-fits-all' solution for the Highlands and Islands. The vastness of region and the scattered spread of communities varying in size and shape presents challenges and opportunities that differ from east to west, north to south, and from mainland to the islands.

The location of major developments in the Highlands and Islands is a positive step forward for economic growth, and provides a solid starting ground for change in the region's housing sector. Achieving that change will require a radical approach from decisionmakers and joined-up thinking across the housing sector and beyond.

This article first appeared in The Press and Journal in July 2023.


Nicola Grant

Legal Director