Government ‘saved bacon’ of builders

THE outgoing chairman of trade body Homes for Scotland has credited the Scottish Government for having “saved our bacon” during the recession, which decimated small to medium-sized housebuilders.
Andy Pearson, who is also the managing director of Tweed Homes, added that he doesn’t expect a repeat of the pre-2007 housing market “bubble” any time soon. He said: “The face of housebuilding will change. I really don’t see the bubble returning. Banks have learned many painful lessons.” Pearson handed over the reins to the next Homes for Scotland chairman, Jim Preston, who is the managing director of Glasgow-based construction services company Veitchi Group, at the trade body’s annual general meeting on Friday. The 96-year-old Veitchi only launched its housebuilding arm in Aberdeen in 2010 when it hired former Cala director Raymond Tedeschi. The trade body last week hosted Deputy First Minister Nicola Sturgeon as its keynote speaker. She used the occasion to unveil a £120 million boost for the housebuilding sector, where the funding will be used to support people who buy new-build homes on a shared equity basis. The money, part of the Barnett consequentials from the Chancellor’s Help to Buy scheme announced in the most recent Budget, will be available over the next two years to both first-time buyers and existing homeowners. The programme adds to Scottish Government residential property support including shared equity schemes aimed at low-income groups and the MI New Home mortgage indemnity scheme, a Homes for Scotland and Scottish Government project which helps those with small deposits to buy new homes worth up to £250,000. Pearson, whose company Tweed Homes builds in the Borders, said the recession has been particularly difficult for SMEs in the sector. “It has been a rough ride. In the last two years in Scotland we have built just over 15,000 homes – the lowest figure since 1947. We built more homes in the first year of the Second World War. “It has been very challenging for the smaller to medium-sized builders, because 90 per cent of the homes were built by just six or seven companies.” His firm, which built on average about 40 homes a year up until 2007, “did not sell a single property from March 2008 to May 2009”, he said. Government initiatives, such as an acceleration of social housing investment in 2009-10; the National Housing Trust, a programme financed by the government’s Scottish Futures Trust; as well as a range of shared equity schemes were helpful, he said. “We started building affordable homes and we had a good seam of work from various government initiatives that saved our bacon. Without that assistance we wouldn’t be here today,” said Pearson. He added that Homes for Scotland now has a “record” 190 members after it widened its membership to registered social landlords. The group has 96 members which are housebuilders.

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