Economic Recovery and the Housing Market

Crucially, we face an unpredictable economic recovery following the Covid-19 pandemic, and the reporting within the Proposed Local Development Plan will not be able to include the damage created by Covid in terms of human tragedy and the socioeconomic impact on Aberdeenshire. The reports are never going to be entirely current, and are based on establishing the need for housing for the future. However, it is important for Aberdeenshire Council to realise that these reports are beyond outdated for the current economic climate.

In a previous post, we highlighted that there are 7.2 years of land supply availability for Aberdeenshire within the 2019 Housing Land Audit. This was before pandemic and before the drop in the oil price. The UK’s oil and gas industry could lose as many as 30,000 jobs over the next 12-18 months, according to Oil and Gas UK. We can not ignore the impact those job losses will have on our area and the existing housing market.

“Local economic performance is intrinsically linked to the performance of the oil and gas industry.” (Aberdeenshire Council’s Monitoring Report)
“Local economy’s reliance on the oil and gas industry.” (Aberdeenshire Council’s Monitoring Report)

The Proposed Local Development Plan is setting 3000 houses in Formartine alone. It is impossible to fathom how the local authority can claim there is a justifiable need for this level of housing now. Indicative of this, is the ongoing halting of development, where new developments are halting after one phase rather than continuing with further phases. Today, at time of posting, there are 5163 properties available to buy on the ASPC website, with 2786 available to buy on the map area in the photo.

“Until 2015 Aberdeenshire’s housing market had experienced a long period of growth, with high demand and steadily increasing house prices, resulting in a steady supply of new housing being delivered annually. Since the fall in oil price in 2014 and the resulting economic downturn, house prices have also fallen and the rate of housebuilding has decreased. The challenge now is to ensure that land allocations in the LDP continue to come forward in a less certain market to maintain an adequate housing land supply.” (Monitoring Report, Aberdeenshire Council, Nov 2019)

The high demand and increasing house prices before 2015 is no longer relevant to the current economic climate, especially in relation to economic recovery following covid-19, the low oil price and Brexit. It could also be argued that there is an adequate housing land supply already, as shown in the 2019 Land Audit. The maintenance of an adequate supply should not include the destruction of green belt.

http://publications.aberdeenshire.gov.uk/dataset/1e5bbfdb-5fa9-4614-8fdb-98aaa07909b3/resource/2f0c494d-8919-4d51-9bbf-4d3844ade4c9/download/monitoring-report-november-2019—final-for-pldp-2020.pdf

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