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Council / McGregor calls for SIC to be ‘more adventurous’ on housing crisis

Cooper says strong economy will create confidence in construction industry

Redevelopment of the Knab site is a key part of the SIC's plan to tackle the housing shortage.

CREATING and maintaining a “vibrant economy” in the islands will be a key factor in ensuring the lack of available housing can be tackled, according to Shetland Islands Council’s development committee chairman.

Alastair Cooper was speaking at a meeting on Tuesday morning as councillors grappled with a housing shortage acknowledged by development director Neil Grant as “one of the big issues” facing the community.

South Mainland councillor Robbie McGregor was one of several members to ask whether more could be done to address the shortage.

A report from Grant highlighted £27.6 million of Scottish Government funding over the next five years towards the islands’ affordable housing programme.

He said an updated five-year housing investment plan would be presented to members later this year.

The local authority is planning to build over 400 homes at its Staney Hill and Knab sites in Lerwick over the next decade. Hjaltland Housing also plans to build a substantial number of affordable homes in the coming years.

“Whilst there has been good progress on delivery of the programme, the national and local issues relating to supply and cost of materials and access to skilled workforce are creating difficulties,” Grant’s report stated.

McGregor said he was keen to see the council step in and help lessen the risk for private builders by acting as a guarantor in the event some houses could not be sold once they were completed.

Cooper said that had already been happening on a modest scale in recent years, with the SIC effectively providing loan finance, which “shows the model works”.

He said the challenge was how to encourage developers to engage in “speculative building” in remote areas.

“It all comes back to having a vibrant economy,” Cooper said, as that would give developers the confidence to proceed.

McGregor asked whether it would be “possible to pursue this on a more adventurous scale… and encourage builders to come forward and perhaps build 20-30 houses”.

He said the risks to the council were minimal and he intended to pursue the issue further at future meetings: “I’d like to see something a wee bit bigger done.”