Chamber and committees

Homes built under the National Housing Trust initiative will not become the property of the developers. A special purpose vehicle (SPV) for each site will own the homes as long as they remain available for rent under the initiative. The members of each SPV will be the relevant local authority, the developer and the Scottish Futures Trust. After five years, and prior to the end of 10 years, the developers will have the right to instigate the sale of the homes.

I wrote on 17 November 2010 to the Scottish Federation of Housing Associations and other key housing and regeneration stakeholders setting out the implications of the draft 2011-12 budget published that day. This correspondence explained that the provision in the draft budget of almost £400 million included, among other things, around £300 million allocated through current housing and regeneration programmes, as well as additional provision for investment in new affordable housing supply and other housing and regeneration priorities. By using our expenditure next year to lever in additional investment we expect to deliver over £600 million of investment in new affordable housing supply, helping to support around 7,500 jobs.

The level of rent for homes procured through the National Housing Trust (NHT) initiative is expected to start at 80% of the current Local Housing Allowance rate in each area. At this level they will be affordable to households on lower incomes, including those on housing benefit.

Applicants will need to provide details of their income when they apply for an NHT home. Each participating council determines the target groups in its area based on its evidence of need and demand. Details of each council''s target groups are set out in the information memorandum for the NHT which is available on the Scottish Futures Trust website at:

http://www.scottishfuturestrust.org.uk.

As at September 2010, there were around 87,000 households receiving housing benefit in the private rented sector who are paying up to the market rent.

Each local authority is under a statutory duty to determine and keep under review the maximum amount that it can afford to allocate to capital expenditure. In determining this amount, the local authority must have regard to the Chartered Institute of Public Finance and Accountancy (CIPFA) Prudential Code. The Prudential Code is a professional code of practice and requires that capital investment is prudent, affordable and sustainable. In relation to the Housing Revenue Account, the Prudential Code requires a local authority to consider the impact of borrowing on the level of rents and whether the level of borrowing is affordable and sustainable. Scottish Government monitors the level of individual and aggregate Housing Revenue Account (HRA) debt and Scottish ministers may consider issuing guidance if it were deemed to be necessary though there are currently no plans to issue such guidance.

The main reason that new build starts in Q3 2009 were much higher than in Q3 2010 is due to a large number of council house building starts being recorded in Q3 2009 mainly resulting from Rounds 1 and 2. Lower levels of starts coincided with Q3 2010.

However, we have only recently started recording starts in this way and there is only a short-time series over which to compare trends. Factors such as planning issues, infrastructure constraints and weather conditions can also affect starts on site and therefore there is not a uniform spread or pattern of starts.

Research specifically examining the appeal of mid-market rented property in the social rented sector has not been conducted by the Scottish Government to date. However, the current Communities Analytical Services business plan for 2010-11 includes a project on estimating demand for mid-market rent housing. This project is due to start shortly and be completed by the end of February 2011.

There is no measure of demand for mid-market rent housing, but the local Housing Need and Demand Assessments submitted to date can be examined, since, as part of these assessment processes local authorities should have considered the role for mid-market / intermediate rented housing in their housing market areas. In addition, information on the take-up of existing mid-market rent properties will be examined as part of this study. Although the data sources are limited, it is hoped that this study will help increase understanding of the scale of demand of mid-market rented property in Scotland.

Properties for mid-market rent are generally not provided by landlords in the social rented sector. The great majority of properties for mid-market rent are provided by landlords in the private rented sector, through RSL subsidiaries.

At present, the Scottish Government does not hold mid-market rent data at local authority or indeed national level.

We only currently hold data relating to intermediate rented housing in the private rented sector that has been approved for government funding; we do not currently hold data on rent levels in the very limited amount of mid-market rent housing provided by local authorities.

There are only a fairly small number of homes provided for mid-market rent at the moment, but that number is expected to increase over the next few years, through initiatives such as the National Housing Trust.

As published on the Housing Statistics for Scotland web pages on the Scottish Government website, the number of houses completed for low cost home ownership under the Affordable Housing Investment Programme (AHIP) between Quarter 4 2009 (beginning of October 2009) and Quarter 3 2010 (end of September 2010) was 1,766. This equates to 26.6% of the total number of units completed under AHIP and includes new build, rehab and off the shelf.

The link to the Housing Statistics for Scotland web pages can be found at:

http://www.scotland.gov.uk/Topics/Statistics/Browse/Housing-Regeneration/HSfS/NB-AHIP.

As published on the Housing Statistics for Scotland web pages on the Scottish Government website, there was a total of 116 off the shelf purchases from private developers under the Affordable Housing Investment Programme (AHIP) between Quarter 4 2009 (beginning of October 2009) and Quarter 3 2010 (end of September 2010). This equates to 1.7% of the total number of units completed under AHIP. The figure of 116 excludes the figures against the heading other in the published statistics as none of these were bought off the shelf from private developers.

The link to the Housing Statistics for Scotland web pages can be found at:

http://www.scotland.gov.uk/Topics/Statistics/Browse/Housing-Regeneration/HSfS/NB-AHIP.

As published on the Housing Statistics for Scotland web pages on the Scottish Government website, the number of rehabilitations completed under the Affordable Housing Investment Programme (AHIP) between Quarter 4 2009 (beginning of October 2009) and Quarter 3 2010 (end of September 2010) was 375. This equates to 5.6% of the total number of units completed under AHIP.

The link to the Housing Statistics for Scotland web pages can be found at:

http://www.scotland.gov.uk/Topics/Statistics/Browse/Housing-Regeneration/HSfS/NB-AHIP.