Development Value for Money Annual Report Published
Scotland’s Housing Network has recently published the second annual Development Value for Money report.
The findings of the report shows that local authority-led projects were smaller than those led by RSLs. Despite this, the median project size for LAs was larger than that for RSLs. The biggest project completed during 2023/24 was led by an RSL.
In terms of property sizes, two and three-apartment homes (i.e. 1 and 2 bedrooms) were the most common, accounting for around 77.5% of all properties reported to SHN as completed during 2023/24. Only a small proportion of units were delivered which were either one apartment (about 2% of all units) or 5 or more apartments (about 3% of units)
Most development is taking place in areas not classified as rural, with more than 68% of new build units in ‘large urban’ or ‘other urban’ areas, and only one-fifth in areas classified as ‘Rural Scotland’
The average gross cost per unit was around £196,600, a significant increase on the figure of £166,500 reported last year. Ten projects had gross costs per unit of greater than £200,000. Quarterly averages show an upward trajectory with regard to gross costs, gross costs (3pe) and works costs per unit.
Perhaps unsurprisingly, an analysis of costs per unit again suggests that developments in rural geographies, those with higher proportions of specialist provision housing stock and smaller projects tended to be more expensive on a per unit basis.
Andrea Finkel-Gates, Scotland’s Housing Network CEO, said: “It will come as no surprise to landlords across the sector that development costs continue to rise, an average increase of almost 18% on the previous year (more in some instances). We support calls from all our partners for the Scottish Government to reinstate the AHSP funding to previous levels, and to consider the increasing costs of developing.”
The full report can be found here.
Participation in the programme of continuous improvement has been a condition of the AHSP grant funding since November 2022. Scotland’s Housing Network’s DVfM service is the only service that meets the mandatory value for money component. This service is available for SHN members (included in their membership subscription) and non-members (for an additional fee).
SHN is also now collecting Development Value for Money returns for projects completed during Q1 of 2024/25. Collection templates and guidance can be found in the Resources and Publications section of our website. Completed returns should be sent to data@scotlandshousingnetwork.org by no later than Friday 27th September.