Local Housing Strategy: guidance 2019

7. Housing Delivery

- Housing Overview

7.1 Local authorities, as both the statutory housing and planning authority, are responsible for assessing housing requirements, ensuring a generous supply of housing land and enabling the delivery of both market and affordable housing. The LHS should set out the authority’s strategic vision for housing, taking into account national policy objectives and local priorities, based on need and demand evidence from the HNDA.

7.2 Over the current Parliamentary term from 2016-2021, the Scottish Government aims to spend more than £3.3 billion to support the delivery at least 50,000 affordable homes. Funding for affordable housing is available through the Affordable Housing Supply Programme (AHSP), which forms part of the Scottish Government's More Homes Scotland overarching approach to support the increase in the supply of homes across all tenures.

7.3 Under the 'More Homes Scotland' approach, the Scottish Government is increasing the provision of homes across all tenures through a range of measures including the AHSP, the Rural and Islands Housing Fund, the Building Scotland Fund, the Housing Infrastructure Fund and innovative funding measures such as Build-to-Rent. In developing a LHS, Local authorities should consider the various approaches under More Homes Scotland in developing housing priorities and outcomes.

7.4 In the Programme for Government 2018-19, the Scottish Government makes a commitment to plan together with stakeholders for how our homes and communities should look and feel in 2040, and the options and choices to get there. The Scottish Government will launch a formal public consultation in the autumn on its Housing to 2040 vision and principles, together with policy choices and options for how to get there. The outputs from the autumn consultation will help inform the final vision and a route map to 2040, which the Scottish Government aims to publish in spring 2020.

7.5 The LHS should demonstrate that the local authority has a good understanding of need and demand, housing supply, flows across the housing system, between tenures, and how this has influenced decisions related to house size, type, tenure and accessibility within communities, sub areas and across the local authority area as a whole. Local authorities should set out clearly their priorities for housing investment including specific provision, areas or communities of focus and activity over the period of the LHS.

7.6 Where the HNDA and LHS process identify particular shortages of affordable or specialist housing types in parts or all of the areas, proposals for this should be clearly set out in the LHS particularly where the local authority considers that the Development Plan has a role to play in meeting these requirements.

- Aligning Land and Housing

7.7 Housing and planning authorities should continue to work closely together to take forward the processes that underpin effective housing planning and the delivery of strong local housing outcomes. As outlined in paragraph 2.15 above, the development of the LHS is linked to the timescales for Development Plans and the two should be closely aligned, with joint working between housing and planning officers.

7.8 The local authority is the statutory authority for housing and is in most cases also the planning authority. However, for land contained within a National Park, the National Park Authority is the statutory planning authority and must work closely with relevant local authorities to agree housing priorities and deliver land for housing.

7.9 Scottish Planning Policy states that the planning system should contribute to raising the rate of new house building by identifying a generous supply of land for the provision of a range of housing, including affordable housing, in the right place.

7.10 In recognition that having a HNDA on the same timeframe may not be effective to drive housing policy and housing investment decisions, local housing authorities will be expected to undertake a revised HNDA around every five years to align with LHS development.

7.11 The ability to provide housing of the right type in the right place to meet the needs of the current and future population is fundamental to the LHS, and local authorities are encouraged to consider engaging with a range of stakeholders as outlined in Section 5 of this guidance.

7.12 Throughout the lifetime of the LHS, local authorities should consider the contribution that surplus public sector land can make to the delivery of affordable housing in their area, including for key workers, which is necessary to sustain public and other local services, as appropriate. Planning Advice Note (PAN) 2/2010: Affordable Housing & Land Audits advises on increasing affordable housing and the preparation of housing land audits.

- Housing Supply Target

7.13 The LHS should include a summary on the level and type of housing to be delivered over the period of the LHS, and crucial to this is the setting of a Housing Supply Target (HST). A separate background paper should explain in detail how the HST was determined and agreed, and a copy web link provided.

7.14 In setting and agreeing the HST, full consideration should be given to factors that may have a material impact on the pace and scale of housing delivery, such as:

• Economic factors which may impact on demand and supply;
• Capacity within the construction sector;
• The potential inter-dependency between delivery of market and affordable housing at the local level;
• Availability of resources;
• Likely pace and scale of delivery based on completion rates;
• Recent development levels;
• Planned demolitions;
• Planned new and replacement housing or housing being brought back into effective use.

7.15 The setting and agreeing of the HST is also covered in the HNDA Manager’s Guide.

7.16 The HST should be split into market and affordable and expressed at both local authority and functional housing market area level. For local authorities covering a large geographic area or with distinct sub-markets, it may be helpful to set out the HST at sub-housing market area level.

Areas the Scottish Government would expect to see addressed in each LHS:

a) The local authority’s strategic vision and its priorities for housing across all tenures taking into account both national and local priorities.

b) A summary of the level and type of housing to be delivered over the period of the LHS together with an explanation around how the Housing Supply Target (split into market and affordable) has been determined and a web link or copy of any background paper explaining how it has been identified.

c) Demonstration of a good understanding of need and demand, housing supply, flows across the housing system, between tenures and how this is reflected in the LHS by size, type, tenure, accessibility together with any evidence on whether this has influenced or been affected by any amendments made to the LDP.

- Rural Housing

7.17 The character of rural and island communities range from higher populated and more pressured areas around towns and cities to less populated, remote and more fragile communities. The challenges faced in providing good quality new housing, housing maintenance and the delivery of housing related services that meet the needs of people living in rural communities also varies.

7.18 The Scottish Government’s Rural & Islands Housing Funds aim to increase the supply of affordable housing of all tenures in rural Scotland and contribute to the Scottish Government’s 50,000 affordable homes target. More information, including details of the organisations, areas eligible to apply and case studies is located here.

7.19 Within the National Parks, the National Park Authority is the statutory planning authority for the area but the statutory responsibility for housing remains with the relevant local authorities that the Park covers. The LHS should evidence the close working relationship between the National Park and the local authority to evidence that there is a joined up approach to housing delivery.

7.20 Scottish Planning Policy recognises the contribution that housing can make to sustaining remote and fragile communities and includes provisions for small-scale housing developments or single units to be supported where it contributes to sustainable economic growth.

7.21 The Islands (Scotland) Act 2018 introduces a number of measures to underpin the Scottish Government’s key objective of ensuring that there is a sustained focus across Government and public sector to meet the needs of island communities now and in the future.

7.22 Local authorities with inhabited islands in their area should have regard to the duties in the Island (Scotland) Act 2018 to consult island communities in relation to a policy, strategy or service that is likely to have an impact on an island community. A LHS, for a local authority area that includes island communities, should ensure that the duties are supported and reflected in the LHS as appropriate. Scottish Government currently expect to lay the regulations required to implement the Islands Communities Impact Assessments before the end of 2019, and to have the statutory guidance available to coincide with the provisions of Part 3 coming into force, in early 2020.

7.23 The LHS should show how the local authority is working with a range of stakeholders, such as, Forestry and Land Scotland, Scottish Forestry, Small Communities Housing Trusts and a range of other community groups, to address the challenges of living in more rural areas to effectively deliver housing and housing related services.

7.24 The LHS should summarise the challenges faced by the local authority in the delivery of housing and housing related services in rural areas. The LHS should evidence the impact on service delivery that restricted access and connectivity can have on social inequality for those living in a rural location and how these impacts are being better understood, considered and addressed.

Areas the Scottish Government would expect to see addressed in each LHS:

a) A summary explaining the distinctive issues (including any challenges) for housing and housing related services in rural areas together with an explanation for how these are currently being addressed and what plans there are to address these in future.

b) A summary explaining how the local authority is working with a range of stakeholders, such as, Forestry and Land Scotland, Scottish Forestry, Small Communities Housing Trusts and a range of other community groups to deliver housing and housing related services for people in rural areas.

c) If appropriate, how any consultation with island communities has helped influence the development of LHS priorities and outcomes and a web link to a copy of the Island Communities Impact Assessment that has been prepared in relation to the LHS.

- Private Rented Sector

7.25 The Private Rented Sector (PRS) has undergone significant change in terms of the overall size of the sector and the tenant and landlord profile. “A Place to Stay, A Place to Call Home: a Strategy for the Private Rented Sector in Scotland” (‘the PRS strategy’) sets out a vision for “a private rented sector that provides good quality homes and high management standards, inspires consumer confidence, and encourages growth through attracting increased investment”.

7.26 Since the publication of the PRS strategy, the Scottish Government has undertaken a range of work to drive forward improvements in the PRS, including introducing a new Private Residential Tenancy, regulating letting agents and publishing statutory guidance for local authorities on landlord registration.

7.27 Local authorities should develop a broad understanding of the extent and location of the PRS in the local authority area for both private rented sector and the social rented sector together with any local issues for the sector fully explained.

7.28 The LHS should set out how the local authority is meeting the three strategic aims of the strategy which are to:

• Improve the quality of property condition, management and service in the sector;
• Deliver for both tenants and landlords - meeting the needs of those living in the sector and those seeking accommodation and landlords committed to continuous improvement;
• Enable growth and investment to help increase overall housing supply.

7.29 A local authority can apply to Scottish Ministers to have an area designated as a “Rent Pressure Zone” if it can prove that:

• Rents in the area are rising too much;
• Rent rises are causing problems for tenants;
• The local authority is coming under pressure to provide housing or subsidise the cost of housing as a result.

7.30 Rent Pressure Zones only apply to rent increases for tenants with a Private Residential Tenancy and if an area is designated, a cap (maximum limit) will be set on how much rents are allowed to increase each year for exiting tenants (with a Private Residential Tenancy). A Rent Pressure Zone Checker is located here.

- Build to Rent

7.31 The Build to Rent (BtR) sector provides opportunities to diversify housing delivery and increase housing choice. Build-to-Rent is the term used for the residential schemes being designed, built and managed specifically for rent, whilst PRS (Private Rented Sector) is the catch-all for all rented homes, including Buy-to-Let (BTL). Planning Delivery Advice on Build to Rent sets out the opportunities and challenges of the BtR sector and is located here.

7.32 The LHS should demonstrate that consideration has been given to delivery of housing through Build to Rent. If a strategy has been developed then reference should be made to this in the LHS.

Areas the Scottish Government would expect to see addressed in each LHS:

a) Information on the extent and location of the PRS in areas together with information on any local issues that have been identified.

b) A summary explaining how the local authority is meeting the aims of the PRS Strategy as summarised in Para 7.28 above.

c) Details of any designated Rent Pressure Zones or any current applications submitted to Scottish Ministers seeking to have an area designated as a Rent Pressure Zone.

d) Inclusion of outcomes in the action plan to address any issues that have been identified and which support the aims of the PRS strategy.

e) A statement that demonstrates that Build to Rent has been considered together with reference to any strategy that has been developed.

- Self-Build/Custom-Build

7.33 The Scottish Government recognises the important role that self and custom build housing can play in providing homes, sustaining communities and supporting smaller building companies in both rural and urban areas.

7.34 Self-build, or on a larger scale, custom build can be individually driven, collective, or community led, providing viable options for a range of households. It can be an affordable option for housing delivery, with the flexibility to support the development of accessible housing.

7.35 Developers of custom-build projects work with individuals or groups of individuals to provide new housing, using a range of different models and approaches. This differs from self-build, where an individual organises the development. Self-build and custom-build can be viable alongside mainstream developer activity or as a way of encouraging private sector investment in areas where developers have shown less interest.

7.36 The LHS should show how the local authority has determined if there is local demand for self-build/custom-build housing in their area and whether it could support any identified demand through to the provision of suitable serviced plots.

7.37 The recently published Planning (Scotland) Act 2019 requires local authorities to prepare and maintain a list of persons who have registered interest with the authority with the intention of acquiring land in the authority’s area for self-build housing. The Act states that local authorities are to publish these lists for example, by use of the internet.

Areas the Scottish Government would expect to see addressed in each LHS:

a) How the local authority intends to prepare and maintain a list of those interested in acquiring land for self-build in their area. Local authorities should consider the key information the list will record, how it will maintain the lists and crucially, how it will respond to the demand for land for self-build.

b) How it plans to publish these lists.

c) A statement on what advice/information/assistance is available locally and how this can be accessed, including how to register interest in self-build/custom-build.