Housing in England and Scotland: A comparative analysis
One of our aims with the Scottish Health Equity Research Unit is to analyse how different policies in different parts of the UK have shaped outcomes. Replicating existing analysis presents a good opportunity to look at the issues that matter most elsewhere in the UK and to provide a companion analysis for Scotland.
A paper by the Resolution Foundation, published in May 2024, covered a number of different areas to explain trends in housing in England[1]. Their paper was part of their General Election programme of analysis and the analysis was focused on England (housing is a devolved issue). The themes they discussed remain of interest in England post General Election for the new UK Government and are also high up the agenda in Scotland.
Housing has key implications for health outcomes. Issues with housing affordability and the quality of lower cost housing stock have direct implications for both physical and mental health. Moreover, unstable housing situations can create difficulties for families trying to find stability. Therefore, housing policy is a key tool for mitigating health inequalities, and as a devolved area, the Scottish Government have a lot of control over what happens.
This paper moves through a series of themes related to housing quality that were presented in the original Resolution Foundation analysis for England. Our aim is to provide a sense of similarities and differences between the Scottish and English experience. We finish with some reflections on what governments across the UK can learn from these policy choices.
Theme 1: Attitudes towards housing
In Scotland, trends over time look similar to the Great Britain figures used by the Resolution Foundation. The number of people identify housing as one of the top three concerns has risen from 10% to 25%.
As chart x shows, more people in Scotland count it in their ‘top 3’ compared to the UK, which is probably due to the fact that fewer people in Scotland place “immigration and asylum” into their top 3 (28% in Scotland ranked compared to 40% in GB).
Theme 2: Delivery of housing supply targets
“There has been an uptick in completions [in England] since the early 2010s, but reaching either main party’s target would require an almost doubling of current building” Resolution Foundation, Home Truths.
The target the Resolution Foundation refer translates to around 300,000 new homes per year in England, with both Labour and the Conservatives setting out broadly similar national targets.
There is no equivalent national all-tenure house building target in Scotland (although targets do exist for affordable housing). Instead, Local Planning Authorities expected to set out the housebuilding requirements for the areas they cover to exceed their Minimum All Tenure Housing Land Requirement (MATHLR).
Analysis by the Competition and Market’s Authority (CMA) (also referenced in the Resolution Foundation report) calculated a sum of these targets equating to 20,000 homes per year at the time of their report (early 2024), and they note that Scotland is relatively close to meeting this implied 10-year target average and in some years have exceeded it[2]. However, they note variations across Scotland, with areas such as Edinburgh and Glasgow at around 75% of their MATHLR target.
On the face of it, this places Scotland in a much more favourable light than in England. However, there is an alternative metric that counts additional net supply (e.g. including conversions) rather than just new house building. This is arguably the metric most suitable for assessing delivery of ‘new homes’.
If net additional supply figures were used instead, England would be meeting around 80% of its target. Figures on net additional supply for Scotland are not as up to date as England, but for the most recent 5 years for which there is Scottish data (2016-17 – 2020-21), the figures for Scotland and England would be 91% and 77% of target respectively, which still shows Scotland making better progress against its implied targets.
Theme 3: New affordable and social housing
“…although the average number of additional affordable homes built [in England] in the last [UK] Parliament was strong by historical standards (an average of 60,000 annually), only 8,000 a year on average were full social rent” Resolution Foundation, Home Truths.
This type of supply is often referred to as ‘affordable housing’ There are different forms of affordable housing options, some of which are still met by private developers through planning obligations. Publicly funded housing is usually delivered by local authorities and housing associations with social rent the most affordable category. The Resolution Foundation note that levels of publicly funded housebuilding are also likely to need to increase in England for targets to be met.
Scotland has explcit targets around affordable housing but there is no specific affordable housing target in England. Looking at the same time period as the Resolution Foundation (the last UK Parliament) Scotland delivered 10,000 new affordable homes per year on average, of which 7,000 were for social rent (only 1,000 less than the whole of England)[1]. A population share of English spending in Scotland would equate to approximately 5,000 affordable homes, and 800 homes for social rent.
The differences between Scotland and England are significant, particularly in relation to social housing. Over the same time period, around 13% of new afforable homes were for social rent in England compared to 70% in Scotland
Theme 4: Youth homeownership rates
“…although the tide appears to have turned, young people [in the UK] today are still less than half as likely to be home owners as they were 30 years ago” Resolution Foundation, Home Truths.
The Resolution Foundation look at the UK numbers for the proportion of families headed by someone aged 18-29 who are homeowners.
Replicating the same analysis for Scotland shows a similar pattern compared to the UK average in terms of a long-term decline in youth ownership, reaching a trough at around the same time as the financial crisis, and an uptick since then. Apart from around the time of the financial crisis, youth homeownership has held up a little better in Scotland. The difference is likely explained by lower average house prices in Scotland, rather than different policy approaches.
Theme 5: Energy Efficiency
“Energy efficiency in homes has improved greatly, but there’s still a substantial way to go” Resolution Foundation, Home Truths.
The Resolution Foundation report on the encouraging progress that has been made in improving energy efficiency in the English housing stock, particularly in the social rented sector, over the past ten years. The worst performing sector is the owner-occupied sector.
EPC ratings in Scotland differ from EPC ratings in England, so direct comparison of the analysis in the Resolution Foundation report aren’t possible. However, there are points of interest.
The Scottish data splits the owner-occupied stock into property owned outright (perform worst) and those that are owned with a mortgage (perform better than the private rented sector). Homes that are owned outright perform worst out of all tenures, but the rates are far better for those owned with a mortgage. The difference here may relate to age of homeowner (older homeowners are more likely to own their homes outright).
Progress between 2014 and 2019 for homes owned with a mortgage means energy efficiency by this measure has overtaken the private rented sector and the local authority owned social rented sector.
The best performing is the social housing owned by a housing Association with nearly 70% with a EPC rating of C or above. A clear gap remains in energy efficiency between homes build pre and post 1991.
Theme 6: Housing costs by tenure
“In 2022-23, the average [UK] family renting in the private rented sector spent around a third of their income on housing costs, compared to the average mortgagor who spent closer to the tenth of their income. Resolution Foundation, Home Truths.
In Scotland, despite house prices being a little lower, lower average earnings means that a family with a mortgage spends a similar proportion of their income on housing costs associated with a mortgage.
Housing costs for renters, both in the private rented sector and the private rented sector are lower in Scotland than the UK average. The gap is particularly large for the private rented sector, with tenants spending closer to a quarter of their income on rent in Scotland, compared to closer to a third in the UK on average.
Reflections
Each theme that we have analysed has shown that Scotland appears to be performing better than England on housing. Whilst some of the difference can be attributed to lower population pressures and market forces, in other areas it is clear that government policy has taken Scotland in a different direction. The most notable example of this is in relation to the delivery of new affordable, and particularly social, housing supply.
However, doing more than England does not mean that enough is being done to tackle the problems in Scotland. In fact, the Scottish Government has stated that Scotland is in a housing emergency due to issues around affordability and access to social housing.
Spending data for 2022/23 shows that Scotland spends about double the amount on housing per person compared to the UK average, but budget pressures have already led to cuts in the Affordable Housing Supply Programme and this pressure is likely to continue.
One area where we haven’t been able to compare with the UK is on energy efficiency and in general it is difficult to compare data on other aspects of housing quality across the UK due to different measures and different surveys used to collect data.
Being able to robustly evidence the link between housing quantity and quality is critical for ensuring the full impact of policy decisions are understood, and comparative analysis with other parts of the UK where different decisions have been taken could help with this endeavour. This is an issue SHERU will return to over the course of our work.
[1] Resolution Foundation, Home Truths, available here
[2] Summary of CMA market study final report into housebuilding Scotland summary available here
[3] Scottish Government Housing statistics, available here