National Islands Plan: annual report 2024

Housing

Strategic Objective 4 – Improve housing

Commitment 4.1 Ensure that Housing to 2040 truly reflects the distinct needs of island communities.

Commitment Fulfilled.

This commitment was fulfilled in 2020. Please see the National Island Plan 2021 Annual Report for further details.

Commitment 4.2 Ensure that the regulation of short-term lets takes account of the unique circumstances of island communities and make special provision for them where required.

Implementation Route Map 2024

• We have monitored the implementation of short terms lets regulation and introduced the Civic Government (Scotland) Act 1982 (Licensing of Short-Term Lets) (Amendment) Order 2024 to make technical updates to the licensing scheme, which Parliament passed on the 26 June 2024. We published impact assessments, including an assessment of impact on island communities.
• Local authorities now have powers to introduce short-term let control areas in order to manage the number of short-term lets in their area.

Licensing schemes have been in operation since October 2022, and new hosts must now obtain a licence before accepting bookings or receiving guests. Currently a significant proportion of existing short-term let operators’ applications have been determined with a small number still outstanding.

In August 2024, the Amendment Order 2024 passed by Parliament on 26 June 2024 came into effect. This makes technical changes to the short-term let licensing scheme such as the ability to transfer a short-term let licence. In August we also published the Short-Term Let Licensing Implementation Update Report 2024, which included feedback relating to island areas. This report provided early indications that short-term let licensing in Scotland is leading to improved safety and quality and achieving national consistency on safety standards. The Minister for Housing formally updated Parliament on licensing implementation on 19 November 2024.

The newly established Short Term Let Licensing Expert Guidance Group launched in December 2024. The Group is chaired by VisitScotland with expertise from across the short-term accommodation sector, licensing authorities planning authorities and SOLAR invited to work in collaboration with VisitScotland to deliver an update to Scottish Government guidance.

We are aware some of the changes being proposed for short-term let licensing are beyond what can be addressed in guidance, we intend to seek wider views on these areas before considering how to proceed.

We will continue to monitor the implementation of licensing, with a further implementation update report being published in 2025.

Commitment 4.3 Explore how the Rural and Islands Housing Fund might be adapted in the future to expand the range of options to support housing development in remote and island communities.

Commitment Fulfilled.

This commitment was fulfilled in 2020. Please see the National Island Plan 2021 Annual Report for further details.

Commitment 4.4 Continue to provide grants to crofters to build and improve croft houses.

Commitment Fulfilled.

This commitment was fulfilled in 2020. Please see the National Islands Plan Annual Report 2020 for further details.

Commitment 4.5 Make best use of all housing stock including derelict properties and options for compulsory purchase.

Implementation Route Map 2024

• Through Housing to 2040 we have committed to take a range of actions to help bring empty homes back into use including an audit to inform how we deliver the other actions. The independent audit considered the scale, characteristics and location of empty homes, and the effectiveness of interventions to bring them back into use. The findings endorsed our approach and showed that the most cost-effective intervention is at local authority level, with dedicated empty homes officers working with private owners to bring homes into use.
• We continue to support and fund the Scottish Empty Homes Partnership which has helped bring almost 11,000 empty homes back into use since 2010.
• In April 2023, we launched a consultation on proposals to increase council tax on second and long-term-empty homes. The regulations have now been amended to (1) provide a grace period from exposure to the council tax premium when an empty home is purchased by a new owner and renovations or repairs are being undertaken; (2) enable local authorities to charge a 100% premium on second homes from 1 April 2024 which brings them into line with the existing powers on empty homes. We will continue to discuss other options with Local Government based on the analysis of consultation responses, including a possible increase in the premium beyond 100%.

In line with our previous commitments, we are continuing to consider the justification for, and practical operation of Compulsory Sales Orders (CSOs) against a complex practical and legal background, including compatibility with the European Convention on Human Rights.

The comprehensive Compulsory Purchase Reform programme, a Programme for Government (PfG) 2023-24 commitment, which began in Spring 2024, following the establishment of the Practitioner Advisory Group, is well under way and PfG 2024-25 commits us to a public consultation on proposed changes in 2025. The work undertaken so far includes intensive stakeholder engagement to help build our evidence base and to inform the development of options for reform. For more details of the work and the emerging proposals, please see our December 2024 Progress Report.

Commitment 4.6 Improve access to homes for people looking to settle in, or return to, island communities. In collaboration with local authorities and relevant stakeholders, we will examine the full range of options to do this, making best use of our existing homes and new supply.

Implementation Route Map 2024

• In October 2023, we published a Rural & Islands Housing Action Plan to meet the housing needs of, and retain and attract people to, those communities. The action plan marks an important step in tackling the challenges head on and includes a range of actions to support for the delivery of the right homes in the right places working with a range of partners.
• We have committed to deliver 110,000 affordable homes by 2032, of which 70% will be for social rent, with at least 10% in rural and island communities.
• In recognition of the challenges with recruiting and retaining staff in rural and island communities, we are making up to £25 million available from our affordable housing supply programme budget over the period 2023-28. The funding will support local authorities and registered social landlords to purchase existing suitable properties which can be rented directly or leased to employers to provide affordable homes for key workers.
• Recognising the importance of community-led housing in rural and island communities, we are providing a package of financial support, co-funded with Nationwide Foundation, of up to £960,000 over the period 2023-24 to 2025-26.

Implementation of the Rural and Island Housing Action Plan remains a priority for the Scottish Government and supports the delivery of the 110,000 affordable homes target of which at least 10% will be in rural and island communities.

In October 2024, the Minister for Housing held the first annual summit of the Rural and Islands Housing Action Plan which brought together a wide range of stakeholders including local authorities, rural housing enablers, development trusts amongst others to discuss progress with delivery of the commitments in the plan. The summit included a session by Shapinsay Development Trust on the delivery of community-led housing projects in Orkney.

Between April 2016 and end March 2024, the Scottish Government, through the Affordable Housing Supply Programme has helped to support the delivery of over 12,400 affordable homes, of which 1,295 have been delivered in island communities.

The demand-led £30 million Rural and Islands Housing Fund continues to play an important role in helping community organisations and others to deliver affordable homes, while complementing delivery through our mainstream programme by councils and housing associations in rural and island areas. 44% of completed projects supported through the Rural and Islands Housing Fund have been in island areas, with projects in Ulva Ferry, Scalpay, Rum, Papa Westray, Yell, Skye, Lewis and North Uist, amongst others.

We are making available up to £25 million from our affordable homes budget up to March 2028 on a demand-led basis for the Rural Affordable Homes for Key Workers Fund to enable local authorities and registered social landlords to provide affordable homes for key workers where there is identified need.

We have supported projects in Orkney and on Arran and continue to work with local authorities and registered social landlords to bring forward additional projects where there is identified need working collaboratively with local partners.

Commitment 4.7 Ensure that the impact on Gaelic-speaking communities is considered as housing policies are developed.

Implementation Route Map 2024

• It is expected that Local Housing Strategies prepared by local authorities will evidence how the development of outcomes have been influenced by community engagement and consultation to deliver national priorities, plans, and targets, and how the Place Principle 2 is being used to deliver change within communities and achieve desired outcomes.

In November 2024, the Scottish Government published its response to the report of the Short Life Working Group on Economic and Social Opportunities for Gaelic. The Group made 12 recommendations relating to Population & Housing of which the government has accepted 10 and noted one. By accepting these recommendations, we are committed to considering the impact of housing policies on Gaelic-speaking communities, as well as other issues such as infrastructure and connectivity, in ensuring the preservation and revitalisation of Gaelic in Scotland’s island communities.

Existing strategies, such as Housing to 2040 and the Rural and Island Housing Action Plan, will consider the particular interests of Gaelic communities as they work towards their wider targets.

The Convention of the Highlands and Islands (CoHI), through the contribution of Bòrd na Gàidhlig, will consider the implications of housing provision for the sustainability of Gaelic.

Local Housing Strategy guidance will be refreshed to explore how local authorities could be asked to consider the role of new homes in sustaining cultural – as well as social and economic – aspects of community in line with place-based principles. CoHI, alongside relevant bodies, will explore a voluntary “fair chance scheme” in relation to selling homes.

The Scottish Government will also work with the Crofting Commission to highlight issues in relation to housing which arise from intestacy within Gaelic communities.