by EWAN LAMB
Recent claims that Scottish Borders Council's intention to develop hundreds of new homes on the Lowood country estate they acquired for £9.6 million may be 'undeliverable' seem bolstered by a range of statistics covering housing starts, completions and property prices.
It has been argued the level of demand for privately built residences in the Borders region is too low to attract nationally known volume building companies in sufficient numbers to ensure Lowood's success as a location for 300-400 new houses by the banks of the Tweed near Melrose.
A consultant's report setting out the problems and issues was handed to SBC months before the local authority agreed to pay the asking price for Lowood - in excess of its true value, according to the District Valuer - into the bank accounts of two Cayman Islands based businesses. When fees and charges are added the bill for Borders taxpayers will top £11 million.
The specialist firm of JLL [Jones Lang Lasalle] which carried out a detailed assessment of the Tweedbank Masterplan including the proposals for 110 acres at Lowood, concluded in a report for their clients that large-scale house building to swell the population of Tweedbank village represented a considerable financial risk.
According to the JLL report: "A fundamental failing we consider, is that there has been no commercial or development appraisal input to the preparation of the Masterplan to ensure viability".
And crucially the firm said their own appraisal demonstrated that the site could not produce a positive land value with insufficient revenue to generate a developer profit.
SBC has repeatedly shrugged off these worrying predictions with counter claims that the development of Lowood will produce economic gains and employment for the Central Borders. The intention is to sell off the Lowood land in phases to developers.
But research by Not Just Sheep & Rugby shows the number of private new-build housing starts and completions in the Scottish Borders region fell to very low levels in 2017 and 2018 while the average price for residential property locally dropped by almost seven percent between January 2018 and January 2019. The hoped for housing boom following the reopening of the Borders Railway has not yet materialised.
The figures for private-build starts make fairly depressing reading. In 2018 the total of 211 was the lowest recorded since 1998 (197). The 2017 tally of 274 was also well down on the totals for 2000 (507), 2006 (692), 2007 (1,103) and 2008 (483).
Even the 2009 total in the wake of the global financial meltdown was a respectable 331 while in 2010 the builders just exceeded that 2018 statistic of 211 by starting 215 private homes.
At the other end of the construction process new-build completions in 2018 (209) and 2017 (173) were the lowest since 1999 (215). Some of the historic annual totals outstrip the recent recorded completions by a huge margin.
For example, in the year 2000 the tally was 507, in 2003 it was 786, the 2008 figure was 473 and in 2010 it stood at 429.
Average house prices are published by the UK Government with the Borders figure at January 2019 recorded as £144,138 compared to £154,601 a year earlier. That represents a 12 months fall of 6.8%.
We also examined average house price levels for each of the local authorities closest to Scottish Borders. In each case there was a year on year increase.
Midlothian experienced the biggest rise - up 13.6% between 2018 and 2019 from £164,898 to £187,264. So has the railway been a factor in driving up prices in Midlothian? Meanwhile East Lothian saw a 2.9% hike in average prices from £215,916 to £222,212.
And even Dumfries & Galloway where average prices are markedly lower than in the Borders, saw a slight lift in the mean cost of private properties. Here the rise was 0.9% from £125,171 to £126,310.
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