Credit crunch 'hits housing jobs'

The house building sector was getting rapidly worse, MSPs heard

The Scottish housing industry could lose 30,000 jobs this year because of the credit crunch, MSPs have been told.

House building could also fall by half in 2008, according to the private industry body Homes for Scotland.

The economic downturn has also seen significant cuts in estate agent and surveyors jobs, Holyrood's economy committee was told.

MSPs on the cross-party committee have been looking into the the impact of the credit crunch on the country's economy.

Homes for Scotland's Allan Lundmark said that, by the end of June, 15,000 jobs had been lost in housing development.

We have seen widespread halts in construction Mark Hordern Edinburgh Solicitors Property Centre

He said: "As of last week we think that figure could have moved to 30,000."

Mr Lundmark said construction levels had remained stable for the past five years, at about 25,000.

But he warned MSPs: "The information we have now, we think that Scotland will drop to at least 15,000 this year. That figure could drop to 12,000, so production could be halved."

The committee also heard from Mark Hordern, the head of marketing at the Glasgow Solicitors Property Centre, who cast doubt on the Scottish Government's target to boost the number of new homes being built to 35,000 a year by the middle of the next decade.

He said the current state of the house building sector was bad and getting "quite rapidly worse".

"We have seen widespread halts in construction, even developments that we expected developers to build because they were part way through," Mr Hordern told MSPs.

He also claimed there had been "substantial redundancies" among surveyors and estate agents and a knock-on effect for companies such as removal firms.

Ron Smith, chief executive of the Edinburgh Solicitors Property Centre, said year-on-year house sales in the Scottish capital were down 41% in 2008 and that homes were now taking much longer to sell - about 100 days compared to about 60.

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