Affordable and social housing finance innovation - synthesis, reflection and implications for Scotland: international evidence

Discussion, Reflections and Implications

Returning to themes set out in the introduction: we should not expect a silver bullet. Policy transfer and mobility is tricky and should not be assumed to be unproblematic or wise (but good ideas may nonetheless be customizable). Path dependency matters in housing systems. We should not neglect the likely dominance of the existing stock over the flow of new supply, as should the systemic interdependencies, feedback loops and the real-world dynamics of evolving complex systems. Making progress is also about political priorities and making the public spending case. Many of these themes taken together imply that while there may be quick wins, positive change will take time to design, implement and to feel its effects - this has to be a long-term game and one that is nourished and allow to bed in.

If we finally reconsider the fourfold remit of the HITF centred on unlocking housing investment through partnerships where ‘nothing is off the table’, what does the review suggest? The four remit points and further reflections are highlighted below:

• Build investor confidence and attract further mobile capital investment into housing – stabilise the financial environment through rent determination and certainty, as well by reducing residual anti-investment bias.
• Unlock existing financial commitments – tackle land market failures, guarantees and insurance to reduce debt finance costs, build revolving funds, explore sustainable ways to sweat equity.
• Encourage and promote new delivery partnerships – worth exploring a range of existing and possible approaches: joint ventures; long term leasing; land readjustment; social investment.
• Identify ways to shift the balance of investment in affordable housing to private finance – explore the Lloyds revenue subsidy proposal which could increase private investment and shift public spending over time from demand to supply subsidy (if it can be further detailed and possible challenges overcome).

This has been a rather scatter gun analysis of what has been covered in material from the last 15 years or so. It has been filtered through a Scottish context and reflects no doubt some of my own views. I strongly encourage those interested to look more closely at the Housing 2030 report and to pursue the starred references below.