Data to: 24/09/2019

Table of Key Figures 12

Summary

Contents

4-5

The latest housing market statistics show that the Scottish housing market remains healthy, despite the

significant uncertainty posed by Brexit. Residential property sales in Scotland were up by an annual 4.7%

(+1,159) in Q2 2019, with this increase in sales spread across each of the residential LBTT price bands.

Meanwhile, data from the ONS HPI shows that the average Scottish house price continued to tick up in Q2

2019 - albeit at a slowing rate - increasing by an annual 1.8% to £152K. The latest SG new build statistics

suggest that new build activity does not, so far, appear to have been affected by Brexit uncertainty. There has

been a sizeable increase in new build completions in 2018/19, which were up by an annual 20.8% (+3,669) to

21,292. Furthermore, as at 31 March 2019, there were 315,625 local authority dwellings in Scotland, an annual

increase of 0.4% (+1,192). This is the first annual increase in the local authority housing stock since 1980. The

special feature for this issue covers the Scottish Household Survey, which released its 2018 annual report on

10th September 2019.

10-11

2Sales

Prices

Lending

House Building

Homelessness

Residential LBTT

Special Feature

3

6-7

8

9

We have made significant changes to the format of the Review in Q2 and Q3 2019 (which is different to the old format that ran until

Q1 2019) and are carrying out a survey of readers to collect feedback on this new format and to better understand our readership.

Please click this link https://response.questback.com/scottishgovernment/SHMR to complete the short survey (it should take

less than 5 minutes to complete). The survey will close on 31st October 2019.

READER SURVEY

Contact: Richard.Keatinge@gov.scot;

Bruce.Teubes@gov.scot

Scottish Housing Market ReviewJuly - September 2019

2

25,806 +1,159 +4.7%House SalesQ2 2019: Annual Change

1. Sales

Registers of Scotland statistics show that there were 25,806 residential property sales registered in Q2 2019, an

annual increase of 4.7% (+1,159). As shown in Chart 1.1, this is in line with the medium-term average annual change

in sales since Q1 2010, which currently stands at 4.8%. While sales in Q2 2019 were up on the same period last year,

they were slightly lower than the number of sales in Q2 2017 (-783). Nevertheless, these figures would suggest that

the Scottish property market has, so far, remained healthy despite the significant uncertainty posed by Brexit.

14.7

19.0

21.1

19.8

12.8

16.9

20.3

19.8

13.9

18.4

19.8

20.3

14.5

19.9

24.2

25.5

17.8

24.3

26.3

25.1

16.8

24.6

27.3

28.1

19.4

25.4

26.7

27.9

19.9

26.6

28.5

28.3

18.8

24.6

28.7

28.8

19.5

25.8

4.7%4.8%

-30%

-20%

-10%

0%

10%

20%

30%

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Chart 1.1 Annual Change in House Sales: Scotland (Quarterly)Source: Registers of Scotland

Sales (Thousands) Annual Change (%) Average Annual Change (%) (From Q1 2010)

24,647

25,806

-71 (-5.0%)

6 (+0.2%)

125 (+3.4%)

141 (+8.3%)

156 (+7.1%)

219 (+4.4%)

583 (+7.1%)

24,000 24,500 25,000 25,500 26,000

Scotland Q2 2018

Forth Valley

Aberdeen/shire & Moray

Tayside & Fife

A&B, Highland & Islands

Ayrshires & D&G

Edinburgh, Lothians & Borders

Clyde Valley

Scotland Q2 2019

Chart 1.2 illustrates how the headline increase in sales of 4.7% (+1,159) was spread across Scotland. The largest

increase in sales by volume was in Clyde Valley, where there were an additional 583 (+7.1%) sales registered in Q2

2019, compared with the same period last year. Meanwhile, Forth Valley was the only area to see an annual fall in

sales in Q2 2019, down 71 (-5.0%) on Q2 2018.

The annual increase in sales in Q2 2019 was spread across the price distribution, with sales up annually across each

of the LBTT price bands (see page 9 for more details). Furthermore, in the 12 months to June 2019, sales in the

£145K - £250K, £250K - £325K and £325K - £750K LBTT price bands were all at their highest levels since Q4 2008,

while sales above £750K (566) were just below their peak level (601) since Q4 2008 (this occurred in the year to end

Q2 2015, coinciding with a period of forestalling prior to the introduction of LBTT).

The annual change in the number of

sales across Scotland is equal to the

sum of changes in sales in each area.

By adding the change in sales in each

area to sales in Scotland in Q2 2018

step-by-step, the chart illustrates the

proportion of the total change in sales

across Scotland that is attributable to

each area.

Chart 1.2 Regional Breakdown of Annual Change in House SalesSource: Registers of Scotland

3

Avg. House PriceQ2 2019: Annual Change

2. Prices

£151,619 +£2,616 +1.8%

The latest ONS HPI data shows that the average (mix-adjusted, geometric mean) house price in Scotland stood at

£152K in Q2 2019, up by an annual 1.8%. While house price growth remains positive, the rate of house price growth

has slowed since Q1 2018, as shown in Chart 2.1. The latest data point from the ONS HPI would suggest that this

slowdown in the rate of house price growth has levelled off though, with house price growth in Q2 2019 mirroring the

rate of growth seen in the previous quarter. Chart 2.2 offers a longer-term perspective of movements in the average

Scottish house price, expressed in current and constant (2019) prices. This shows that, in real terms, house price

growth has been relatively subdued since 2016, while real house prices remain below their peak level seen just before

the 2008 financial crisis.

1.5%1.8%

-10%

-5%

0%

5%

10%

15%

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

RoS (Non mix-adjusted, arithmetic mean price) ONS HPI (Mix-adjusted, geometric mean price)

Chart 2.3 shows how house prices have performed across Scotland. House price growth was positive in all but one

area of Scotland, with negative annual house price growth in Ayrshires & Dumfries and Galloway for the third

consecutive quarter. With regard to property and buyer types, the latest ONS HPI data shows that the average price

for new and existing build properties across Scotland both increased by an annual 1.8% in Q1 2019, to £207K and

£146K, respectively. Meanwhile, the average first-time buyer (FTB) property price increased by an annual 1.5% in Q2

2019, to £123K.

ONS rental price index data shows that rental prices in Scotland increased by an annual 0.9% in August 2019 - rental

price growth in Scotland has consistently been lower than across Great Britain since April 2015.

1.7%

-1.1%

0.2%

2.5%

2.5%

1.7%

0.9%

-3% -2% -1% 0% 1% 2% 3% 4%

Clyde Valley

Ayrshires & D&G

Forth Valley

Edinburgh, Lothians & Borders

A&B, Highland & Islands

Tayside & Fife

Aberdeen/shire & Moray

Chart 2.3 Annual Change in House Prices: Scotland Areas (Q2 2019)Source: Registers of Scotland

£60,000

£80,000

£100,000

£120,000

£140,000

£160,000

£180,000

£200,000

2004 2007 2010 2013 2016 2019

Nominal Price

Real Price

Chart 2.2 Average Scottish House Price Source: ONS HPI/CPI. Current & Constant (2019) Prices

Chart 2.1 Annual Change in House Prices: Scotland (Quarterly)Source: Registers of Scotland/ONS HPI

4

18,470 +890 +5.1%

3. Lending

Q2 2019: Annual Change

New Mortgages

Chart 3.1 Loans for House Purchase: Scotland(3 Month Moving Total)Source: UK Finance

0%

20%

40%

60%

80%

100%

£20,000

£25,000

£30,000

£35,000

£40,000

£45,000

2005 2007 2009 2011 2013 2015 2017 2019

Real FTB Deposit (LHS) Deposit (% of Income) (RHS)

Chart 3.3 Mean Scottish FTB Deposit (Constant (2019) Prices, 3 Month Moving Average)Source: UK Finance/ONS CPI

60%

65%

70%

75%

80%

85%

2005 2007 2009 2011 2013 2015 2017 2019

First-Time Buyers

Home Movers

Chart 3.2 Mean LTV for House Purchase:Scotland (3 Month Moving Average)Source: UK Finance

0

5,000

10,000

15,000

20,000

2007 2009 2011 2013 2015 2017 2019

First-Time Buyers

Home Movers

In the three months to June 2019, there were 18,470 new loans for house purchase across Scotland according to

UK Finance, up by an annual 5.1% (+890). Of these, 9,180 were loans to first-time buyers (FTB), up by an

annual 3.7% (+330), and 9,290 were loans to home movers, up by an annual 6.4% (+560). Meanwhile, the latest

data from the Bank of England shows that in the three months to July 2019, there were 226,995 mortgage

approvals for house purchase across the United Kingdom, up by an annual 1.7% (mortgage approvals are the

firm offers of lenders to advance a loan to a customer, secured on a dwelling).

The latest UK Finance data suggests that deposit constraints are continuing to ease for FTBs in Scotland. Loan-

to-value (LTV) ratios on new loans for house purchase have continued their upward trend in Q2 2019, UK

Finance data shows (Chart 3.2)). In Q2 2019, the mean LTV on new loans for house purchase for FTBs stood at

82.7%, up 1.2 percentage points on the same period last year. Meanwhile, the mean LTV ratio for home movers

stood at 71.7% in Q2 2019, up 0.7 percentage points. This upward trend in LTV ratios for FTBs has contributed

to the real terms reduction in the mean Scottish FTB deposit. In Q2 2019, this stood at £25K, down 6.9% (-£2K)

on the same period last year and down 38.1% (-£16K) over the past 10 years (both in real terms). UK Finance

data also shows that mean Scottish FTB mortgage repayments (capital and interest repayments) as a share of

FTB income have gradually been trending downwards since the 2008 financial crisis. In Q2 2019, the mean

monthly FTB mortgage repayment cost was £540.

15%

17%

19%

21%

23%

2005 2007 2009 2011 2013 2015 2017 2019

Chart 3.4 Mean Scottish FTB Mortgage Repayments (Share of Income)Source: UK Finance

5

£25,348 -£1,881Avg. FTB DepositQ2 2019: Annual Change

-6.9%

3. Lending (Continued)

0%

1%

2%

3%

4%

5%

6%

7%

2010 2012 2014 2016 2018

2 Year (75% LTV)

2 Year (90% LTV)

5 Year (75% LTV)

Bank Rate

Chart 3.5 Mortgage Interest Rates: UK (Monthly)Source: Bank of England

Mortgage interest rates remain at historically low levels, Bank of England data show (Chart 3.5). The average interest

rate on a 2 year fixed rate 75% LTV mortgage in August 2019 stood at 1.64%, down 8 basis points since the start of

2019. Meanwhile, the average interest rate on a 5 year fixed rate 75% LTV mortgage stood at 1.92% in August 2019,

just 28 basis points above the average interest rate on a 2 year fixed rate 75% LTV mortgage. This spread is currently

at its third lowest level since January 2010. Meanwhile, the spread between 2 year 75% LTV & 90% LTV remains

narrow at 45 basis points - the second lowest level since January 2010. These last two points reflect strong price

competition currently seen in the UK mortgage market. With regard to high LTV lending, FCA data report that the

share of mortgages advanced across the UK with an LTV greater or equal to 90% stood at 5.5% in Q2 2019. This is

the highest level since Q4 2008 (see Chart 3.6). FCA MLAR statistics also show that nearly two-fifths (39.7%) of

mortgages advanced across the UK had an LTV ratio exceeding 75%, the highest share since Q2 2008.

0%

10%

20%

30%

40%

50%

60%

0%

2%

4%

6%

8%

10%

2007 2009 2011 2013 2015 2017 2019

90 <= LTV < 95 (LHS)

LTV >= 95 (LHS)

LTV > 75 (RHS)

Chart 3.6 Gross Advances by LTV: UK (Quarterly)Source: FCA

0%

5%

10%

15%

20%

2007 2009 2011 2013 2015 2017 2019

4 ≤ LTI < 4.5 LTI ≥ 4.5

Chart 3.7 Share of Lending at High LTI Ratios: UK (Quarterly)Source: Bank of England

Across the UK, the latest Bank of England data shows that in Q1 2019, just over one quarter (27.7%) of new

mortgages advanced had a loan-to-income (LTI) multiple of 4 or above. As shown Chart 3.7, this is a slight dip

on the peak seen in Q3 2018. The share of mortgages advanced with an LTI greater or equal to 4.5 has

remained fairly steady over the past 5 years. This is partly due to the FPC recommending in June 2014 that only

15% of the flow of new mortgages could be at LTI ratios of 4.5 or above, with lenders factoring in a buffer to

prevent them from exceeding this share. Meanwhile, the value of new loans for remortgaging across the UK

dipped in Q2 2019, down 4.3% annually.

£0

£10,000

£20,000

£30,000

£40,000

£50,000

2007 2009 2011 2013 2015 2017 2019House purchase Further advance

Remortgage Other

Chart 3.8 New Lending by Purpose: UK (Quarterly, £m)Source: FCA

6

Year to Q2 '19: Annual Change

4. House Building

9,128 +633 +7.5%AHSP Completions

0K

2K

4K

6K

8K

10K

2008 2010 2012 2014 2016 2018

Affordable Home Ownership

Affordable Rent

Social Rent

The latest Scottish Government new build statistics show that, in the year to end Q1 2019, there were 21,292

new build completions across Scotland, up by an annual 20.8% (+3,669). On a rolling 4-quarterly basis, this is the

highest yearly level of new build completions since the 2008 financial crisis. Meanwhile, there were 22,764 new

build starts over the same period, up by an annual 16.1% (+3,160). These statistics also showed that in the year

to end 31st March 2019, there were 315,625 local authority dwellings in Scotland, an annual increase of 0.4%

(+1,192). This is the first annual increase in the local authority stock since 1980, and will have been supported by

the abolition of the Right to Buy in Scotland, as well as the resumption of SG funding for council new build in

2009.

Chart 4.3 AHSP Completions (4Q Moving Total, to Q2 2019)Source: SG

Chart 4.1 Scottish New Builds (4Q Moving Total, to Q1 2019)Source: SG

0

5,000

10,000

15,000

20,000

25,000

30,000

2001 2004 2007 2010 2013 2016 2019

All Completions

All Starts

Chart 4.2 includes a breakdown of new build completions by sector, showing that private new build completions

in the year to end Q1 2019 were at their highest level since the 2008 financial crisis.

There were 9,128 completions through the Affordable Housing Supply Programme (AHSP) in the year to end Q2

2019, up by an annual 7.5% (+633). Since Q2 2016, there have been 26,581 completions through the AHSP.

YTE Q1 2019:

15.7K, +20.6%

YTE Q2 2019:

5.4K, +12.6%

0K

5K

10K

15K

20K

25K

2001 2003 2005 2007 2009 2011 2013 2015 2017 2019

Private Completions Social Completions

Chart 4.2 New Build Completions by Sector (4Q Moving Total)Source: SG

7

4. House Building (Continued)

All CompletionsYear to Q1 '19: Annual Change

21,292 +3,669 +20.8%

Chart 4.4 Regional Breakdown of All New Build Completions: Scotland Source: SG

4,6

76

3,9

99

3,0

37

2,5

12

1,4

73

1,2

54

672

6,1

28

5,8

62

2,9

04

2,5

15

1,8

64

1,2

25 794

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Clyde Valley Edinburgh, Lothian

& Borders

Tayside & Fife Aberdeen/shire &

Moray

A&B, Highland &

Islands

Ayrshires & D&G Forth Valley

2017-18 2018-19

Chart 4.5 New Build Completions per 10,000 Households: ScotlandAll new build completions in Scotland in 2018/19 expressed per 10,000 households (NRS 2018)

Source: SG/NRS

129.3

101.2

96.3

85.9

80.6

72.8

58.6

50.8

0

20

40

60

80

100

120

140

Edinburgh,

Lothian & Borders

A&B, Highland &

Islands

Aberdeen/shire &

Moray

Scotland Tayside & Fife Clyde Valley Forth Valley Ayrshires & D&G

Chart 4.4 illustrates the geographic spread of new build completions in 2018-19 and 2017-18. There was a

substantial annual increase in new build completions across Clyde Valley and Edinburgh, Lothian & Borders, with

new build completions up by an annual 31.1% (+1,452) and 46.6% (+1,863), respectively, as well as a similarly

large increase in percentage terms in Argyll & Bute, Highland and Islands of 26.5% (+391). However, in the

remaining Scotland areas, new build completions grew relatively modestly or fell slightly.

Chart 4.5 expresses new build completions in each of the Scotland areas for 2018/19 per 10,000 households, to

adjust for variation in local authority size. This shows that there were 129.3 new build completions per 10,000

households in Edinburgh, Lothian & Borders, 50% higher than the Scottish average and 154% more than in

Ayrshires & Dumfries and Galloway.

8

Homelessness Applications

2018/19: Annual Change36,465 +892 +2.5%

5. Homelessness

There were 36,465 homelessness applications in Scotland in 2018-19, an annual increase of 2.5% (+892). Chart

5.2 shows the number of homelessness applications in each local authority per 10,000 people, using the latest

NRS mid-year population estimates (2018). This shows that, in 2018/19, there were just over four times as many

homelessness applications per 10,000 people in West Dunbartonshire (116.3) as there were in Inverclyde (25.6),

which had the fewest number of homelessness applications per 10,000 people.

Chart 5.2 Homelessness Applications Per 10,000 of Local Authority Population: 2018/19Source: SG/NRS

116.3

107.6

98.6

90.7

83.2

77.4

76.2

74.7

71.6

70.7

69.6

67.2

67.1

66.1

63.8

63.4

62.3

62.3

61.2

60.4

59.9

59.8

58.7

53.9

53.7

53.3

50.9

49.7

47.7

44.1

38.9

32.4

25.6

0

20

40

60

80

100

120

West D

unba

rtonshir

e

Cla

ckm

anna

nshir

e

Dun

dee C

ity

Gla

sgow

City

West Loth

ian

South

Ayrs

hire

Nort

h A

yrs

hire

Ea

st Loth

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Aberd

een

City

Fife

Nort

h L

anark

shire

Stirlin

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Scotla

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Ea

st A

yrs

hire

Scottis

h B

ord

ers

Fa

lkir

k

City o

f E

din

burg

h

Pert

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Kin

ross

Dum

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s &

Ga

llow

ay

South

La

na

rkshire

Ork

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sla

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Angus

Mora

y

Mid

loth

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Na

h-E

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na

n S

iar

Arg

yll

& B

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Sh

etla

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sla

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Hig

hla

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Ren

frew

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een

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st D

unba

rto

nshir

e

Ea

st R

enfr

ew

shir

e

Inverc

lyde

52

,07

0

56

,55

8

57

,29

2

60

,29

8

59

,21

5

57

,24

0

57

,67

0

57

,21

1

55

,63

3

45

,53

7

40

,02

7

36

,82

5

35

,96

4

34

,97

3

34

,72

6

35

,57

3

36

,46

5

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

200

2-0

3

200

3-0

4

200

4-0

5

200

5-0

6

200

6-0

7

200

7-0

8

200

8-0

9

200

9-1

0

201

0-1

1

201

1-1

2

201

2-1

3

201

3-1

4

201

4-1

5

201

5-1

6

201

6-1

7

201

7-1

8

201

8-1

9

Chart 5.1 Homelessness Applications: Scotland Source: SG

Home Movers First-Time Buyers

Up to £145,000 Up to £175,000

£145,001 to £250,000 £175,001 to £250,000

£250,001 to £325,000 £250,001 to £325,000

£325,001 to £750,000 £325,001 to £750,000

Over £750,000 Over £750,000

9ADS is payable on the total purchase price of an additional dwelling of £40,000 or more.

4%LBTT is payable at different rates on each portion of the purchase price within specified bands.

Additional Dwelling Supplement

0%

2%

10%

2%

5%5%

10%

0%

6. Residential Land & Buildings Transaction Tax (LBTT)

Residential LBTT Tax Schedule

LBTT Rate LBTT Rate

12%12%

£202

£214

£260

£262

£68

£77

£93

£105

£38

£0 £50 £100 £150 £200 £250 £300 £350 £400

2015-16

2016-17

2017-18

2018-19

2019-20 (April - June)

Main Rates Net ADS

Revenue Scotland LBTT statistics show that from April - June 2019, residential LBTT revenue from the main

rates of LBTT increased by an annual 11.8%, to £68.4 million. A year on year comparison is not suitable for

revenue from the Additional Dwelling Supplement (ADS) due to the rate change on 25th January 2019; however,

net ADS revenue in the three months to June 2019 stood at £37.9 million (defined as ADS liabilities paid minus

repayments of ADS).

Revenue Scotland has recently published statistics on the number of first-time buyers benefiting from the

Scottish Government's first-time buyer relief. In the year from July 2018 - June 2019, 11,150 buyers claimed the

relief, which saves first-time buyers up to £600 on the purchase of their home.

£0

£5

£10

£15

£20

£25

£30

APR MAY JUNE JULY AUG SEP OCT NOV DEC JAN FEB MARCH

2015-16 2016-17 2017-18 2018-19 2019-20

Chart 6.1 Residential LBTT Revenue (£ millions)Source: Revenue Scotland

Chart 6.2 Residential LBTT Revenue (Excluding ADS, Monthly, £ millions)Source: Revenue Scotland

10

Special Feature: Scottish Household SurveyThis quarter’s special feature covers the Scottish Household Survey (SHS),

Scotland’s largest face-to-face random survey. The Survey, which provides

essential information on a range of topics from housing to employment, health

to views on local public services, has been running continuously since 1999.

On 10th September 2019, the 2018 SHS annual report was published. This

quarter’s special feature hears from Dr Emma McCallum, project manager for

the SHS, who explains the why the Survey is run and how the data collected is

used, as well as summarises the key points from the housing chapter.

Why is the Scottish Household Survey important?

Without the government collecting views from its citizens, policies and laws

would be made without understanding the impact on those they apply to. The

face-to-face interviews carried out with individuals through the SHS enable the

government to check if policies are having the intended effect and helps us to

design laws appropriately. SHS data is also used to identify which people or

areas need funding most.

How is the data used?

SHS data is frequently used to help inform the Scottish Government’s housing

policies. For example, the SHS is the only source of Fuel Poverty evidence

and the only nationally representative source of data on energy efficiency,

house conditions and quality. This evidence is used extensively in the design,

targeting and funding allocations for SG energy efficiency programmes

(SEEP).

Much of the SHS data is used for key performance monitoring frameworks,

including: 13 out of 80 of Scotland Performs indicators, half of the Housing &

Regeneration Outcome Indicators, over half of Active Scotland Outcome

Indicators, and over a quarter of the Child Poverty Measurement Framework

Indicators. All local authorities in Scotland use the data in their Single Outcome

Agreements; the Improvement Service use data for the Local Government

Benchmarking Framework; Community Planning Partnerships to understand

and improve local needs and circumstances.

How do you communicate the results of the SHS?

The Scottish Household Survey publishes results in a 300 page report once a

year. This is followed by release of all the same information contained in the

annual report for each local authority in Scotland. This year, the local authority

tables will be released on 8th October.

In order to extend the reach of the statistics to new audiences, we have been

developing the dissemination of SHS results. We wanted to find a way to

communicate statistics in an easy-to-follow and accessible way, so we worked

with external academics and a professional illustrator who brought our analysis

to life using clear text and illustrations, inspired by the visual language of

comics. This was the first time data comics had been used to communicate

statistics by the Scottish Government and it has helped to tackle complex

issues such as inequality. On the back of the new approach, the team has

received a number of recognitions and awards for innovation. This year, we

have produced a visual summary to accompany our technical report and

trialled a story-telling report alongside our physical activity statistics. We’ve

made a film, recorded a podcast and are about to launch an animation. We

have produced an interactive dashboard for users to generate their own tables

and charts and this year are producing a more user friendly version of the local

authority tables.

Any final messages?

If you are selected to participate in the SHS, you will receive an advance letter

and a leaflet through the post about the survey. Please take part and

encourage any friends or family selected to take part. Thank you to any of you

who have taken part already.

11

Special Feature: Scottish Household Survey

62

33

29

23

14

0

10

20

30

40

50

60

70

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

201

5

201

6

201

7

201

8

Owner Occupier Owned outright Buying with help of loan / mortgage Social Rent Private Rent

37

3

34

25

36

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

201

5

201

6

201

7

201

8

Tenure of Households by Year (%)Source: SG

The latest SHS annual report (2018) shows that the share of households in owner occupation (owning outright or

with a mortgage or loan) grew steadily from 1999 to 2009, increasing by 5 percentage points to 66% (+220,000

households). However, from 2009 to 2014 (in the aftermath of the 2008 financial crisis) it dropped by 6 percentage

points to 60% (-100,000 households). This was driven by a decline in the share of households owning their property

with a mortgage or loan, which fell from 36% of all households in 2009 to 30% in 2014. Since then, this figure has

remained at similar levels, standing at 29% in 2018. This has helped stabilise the share of households in owner

occupation, which has also remained at approximately the same level since 2014, standing at 62% in 2018. In terms

of the absolute number of households in owner occupation, there has been an increase of approximately 5% from

2014 to 2018 (reflecting the growth in the total number of households in Scotland).

The share of households in the private rented sector saw marked growth from 1999 to 2016, increasing from 5% of

all households in 1999 to 15% in 2016. The absolute number of households in this tenure approximately tripled over

this period, to stand at 370,000 in 2016. However, since 2016 the share has decreased to 14%, which equates to

340,000 households. With respect to the social rented sector, the share of households in this tenure fell sharply from

32% in 1999 to 23% in 2007, an estimated decrease of 150,000 households. However, since 2007, this share has

fluctuated between 22% and 24%, and stood at 23% in 2018. A key factor in the initial decrease was Right to Buy

sales, with a total of 113,800 sales made from 1999 to 2007. The Right to Buy has now been abolished in Scotland.

Within these overall tenure trends, there have been even more significant changes for households of different ages.

While the share of all households owning with a mortgage or loan has remained relatively unchanged in the past few

years, this is not the case for households with a highest income householder (HIH) aged between 16 and 34. The

share of younger households owning with a mortgage or loan has increased from 28% in 2015 to 34% in 2018

(+30,000 households). This increase is likely to have been driven by an improvement in lending conditions (noted in

the main section of the Review) as well as SG financial support for first-time buyers, such as the Open Market

Shared Equity (OMSE) and New Supply Shared Equity (NSSE) schemes, which comprise the SG’s Low Cost

Initiative for First-time Buyers (LIFT), as well as Help to Buy (Scotland), with approximately 82% of Help to Buy

(Scotland) sales in 2018/19 being to first-time buyers. As a result of it becoming easier for younger households to

access home ownership, the recent fall in the share of households in the private rented sector has been more

pronounced for younger households, falling from 41% in 2015 to 36% in 2018 (-20,000 households) for this age

group.

All Ages HIH 16 - 34

+/- %

12

Latest Value

Homelessness

Applications 2018-19 36,465 +892 +2.5%

Source: SG

Social New Build

Completions Q2 2019 5,378 +600 +12.6%

Source: SG

Private New Build

Completions Q1 2019 15,710 +2,679 +20.6%

Source: SG

AHSP CompletionsQ2 2019 9,128 +633 +7.5%

Source: SG

All New Build

Completions Q1 2019 21,292 +3,669 +20.8%

Source: SG

Average 2 Year Fixed 90%

LTV IR (UK) August 2019 2.09% -0.19%

Source: BoE

Average 2 Year Fixed 75%

LTV IR (UK) August 2019 1.64% -0.11%

Source: BoE

Average FTB DepositQ2 2019 £25,348 -£1,881 -6.9%

Source: UK Finance

New Mortgages Q2 2019 18,470 +890 +5.1%

Source: UK Finance

Q2 2019 £151,619 +£2,616 +1.8%

Average House Price

Source: ONS HPI

Q2 2019 25,806 +1,159 +4.7%

Source: RoS

Number of Sales

Key Figures

Latest PeriodAnnual Change

READER SURVEY

We have made significant changes to the format of the Review in Q2 and Q3 2019 (which is different to the old format that ran until

Q1 2019) and are carrying out a survey of readers to collect feedback on this new format and to better understand our readership.

Please click this link https://response.questback.com/scottishgovernment/SHMR to complete the short survey (it should take

less than 5 minutes to complete). The survey will close on 31st October 2019.

Average FTB LTV RatioQ2 2019 82.7% 1.2%

Source: UK Finance

Average Home Mover LTV

Ratio Q2 2019 71.7% 0.7%

Source: UK Finance