Falkirk Council facing higher costs but vow housing work will continue

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High borrowing costs will impact on the number of houses Falkirk Council is able to build or buy – but most projects remain on track, councillors have been told.

The council’s housing investment programme – which includes building new homes and upgrading existing ones – had a total expenditure of £316 million between 2024-29, but stubbornly high interest rates have meant that has had to reduce.

The programme is funded through rent, grant income and borrowing and members of Falkirk Council heard at a recent meeting that the high cost of borrowing means overall expenditure has reduced to £253 million – a reduction of £63 million, over the next five years.

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The programme has also been impacted by increased costs for materials and services.

The first Falkirk Council homes at Woodend Farm in Hallglen have now been handed over. Pic: Falkirk CouncilThe first Falkirk Council homes at Woodend Farm in Hallglen have now been handed over. Pic: Falkirk Council
The first Falkirk Council homes at Woodend Farm in Hallglen have now been handed over. Pic: Falkirk Council

Members were assured that should interest rates reduce more quickly than anticipated the level of investment will increase.

Spending on new windows, doors and heating systems will continue to be a priority in a bid to combat fuel poverty in particular.

Members heard that in 2025/26, £27.25 million will be dedicated to upgrading 7455 homes.

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The financial pressures mean that councillors agreed that 137 homes to be built on the site of the old Denny High School – which is expected to deliver its first homes in 2027-28 – will now be delivered in two phases.

The plan is for 101 homes to be built in phase one and 36 homes in phase two and members heard that delivering the site in this way “will reduce the financial commitment and risk”.

Officers say that dividing the work into smaller projects could also encourage smaller, local companies to bid for the work but there is a warning that higher than expected tender costs might lead to more changes.

Within the 16,500 homes owned by the council, 386 are classed as “hard to treat” which means they would cost more than £60,000 to bring up to standard.

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They can be lying empty for years and the housing team told members they have been looking at various ways to either upgrade or disposing of them, assessing each property individually.

The council was successful in getting £616,287 of Scottish Government funding from the Ukraine Longer Term Resettlement Fund, which will be used to bring 11 homes back into use and improve the condition of a further six, all in the Denny area.

Members heard that despite the challenges, the council remains on target to meet its target of 180-220 new homes per year in the Falkirk district, through building new homes and also buying back former council properties.

They were told that the council is now concentrating on buying particular types of homes that are most needed, including larger homes and accessible houses.

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They are also “more selective” about the housing so that they are not taking on houses that need a lot of work and have been successful in getting grants to reduce the cost to the council.

Two developments are currently underway: 111 homes will be delivered this year at Woodend Farm, Hallglen, with 32 already built; while 40 homes are being built in Haugh Gardens’ redevelopment.

The tender for the work in Denny is currently being prepared in order for work to start on-site by December.

Councillor Gary Bouse, portfolio holder for housing, said: “This ambitious £253 million investment affirms our commitment to providing high quality, energy efficient and affordable homes for our residents.

“This programme shows a reduction which is necessary to ensure the affordability and to maintain the programme’s aims.”

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