Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.
Scotland's housing supply shortfall and buyer affordability pressures examined
Scotland's housing market faces pressure on both the supply and demand sides, with evidence of a long-term shortage of homes alongside affordability challenges for prospective buyers, according to a report by Mortgage Solutions.
The Confederation of British Industry (CBI) has called for housing to be treated as economic infrastructure, arguing Scotland should aim to deliver at least 25,000 homes per year with clear public delivery milestones. The organisation highlighted a shortfall of more than 110,000 homes since 2008 and urged policymakers to reduce planning uncertainty and delays that can affect development viability and investment.
Affordability concerns among prospective buyers
Research from Pepper Money suggests affordability remains a significant barrier. Its survey found 47% of Scottish adults who do not currently own a home believe they will never be able to do so, while more than one in 10 would like to buy but do not believe it is achievable, rising to 15% among those with adverse credit.
Cost-of-living pressures are also shaping sentiment: around 39% of Scottish adults said the cost of living has affected their ability or motivation to purchase, and 30% cited rising household bills. A quarter of non-homeowners said they do not yet feel financially ready to buy, and 19% believe it will be more than five years before they are in a position to do so. Some 57% of Scottish adults said house prices are increasing too quickly.
Adverse credit and the role of brokers
Challenges appear more pronounced for those with adverse credit histories. Among adverse-credit non-homeowners, 55% said the cost of living has affected their ability or motivation to buy, and 42% expressed concerns about both securing a mortgage and the application process.
The findings suggest mortgage brokers could play a supporting role: almost a third of Scottish adults said they would use a broker for their next home purchase, rising to 41% among those with adverse credit and 61% among adverse-credit consumers hoping to buy within 18 months.
Paul Adams, director of sales at Pepper Money, said the findings show a clear gap between the aspiration to own a home and what many people in Scotland feel is achievable, noting that those who are self-employed, have variable income or have experienced credit difficulties can feel particularly locked out of the mortgage market. He said Pepper Money will work closely with brokers as it launches its first charge mortgage proposition in Scotland.
Source: Mortgage Solutions