THE Scottish housebuilding industry is in crisis. And the man who will help lead the industry through it is John Low, the new chairman of the housebuilders' lobby group, Homes for Scotland (HFS).
The chairmanship of the Edinburgh-based group is an annual appointment. HFS chief executive Jonathan Fair dismisses with a laugh the idea that Low has drawn the short straw as the industry weathers one of the worst storms in living memory.
It app
ears that Low, a bluff Aberdonian who has spent his career with housebuilder Stewart Milne, is up for the challenge. "He is a very straight talker," says Fair. "He is very clear about what he needs and wants and why. That degree of clarity is very helpful at this point in time."
But when speaking to the press, Low, who during the week has a hands-on role as managing director of Stewart Milne North, is more circumspect. "I have to be careful with my words," he says.
The issue Low must tackle, tactfully, is the crux of the problem facing house sellers: what is a property worth? Valuation is a dark art, but it relies on hard facts, such as what houses are selling for. Trouble is, there isn't much selling going on. Low's surveying and valuation background is, according to Fair, "particularly important".
In Scotland, transaction levels haven't been so low since the mid-1970s. Last month the Council of Mortgage Lenders said only 7,600 mortgages had been issued in the first quarter of the year.
And rumours that the market is picking up, largely promoted by those desperate to see confidence return to the sector, seem to be hard to prove. Not only is current house price data rare, it is also subject to manipulation – or what some have even gone so far as to call abuses.
Low's clear focus in his year at the head of HFS will be working with mortgage lenders and valuers. Low wants to ensure the valuation industry is "reflecting and not dictating the market".
He argues: "The industry may from time to time – purely for their own commercial reasons – decide to offer an incentive. That should not necessarily translate into a demerit on the valuation."
The careful words are needed to explain how HFS will handle these delicate negotiations. Valuers and lenders have to be scrupulous about being free from influence.
"Valuers and lenders are entirely independent," says Fair. "Ultimately, they have to come up with approaches to business that are legitimate, predictable and sustainable. But, inevitably, they will listen to evidence of people on the receiving end of those policies and approaches.
"If we feel there is a particular type of mortgage deal or incentive package that has been successful, then we can talk an open forum about that. They can't make those choices in a vacuum. They need information on how that market is behaving. That is our role."
Shortly after Low took the chair last month, HFS made clear it was not going to take the lack of money available to borrowers lying down. The frustration in the industry with banks not lending to potential customers is palpable. Last month HFS accused banks of refusing credit for "unfathomable reasons".
John Slater, group managing director of Stewart Milne Homes, and Low's boss, says that the organisation will benefit from his colleague's tendency to tell it like it is. "He won't be shy of dealing with those issues," says Slater. "And I am sure you (journalists] will enjoy writing about some of his comments that will no doubt challenge people and put them on the spot."
Low points out that 50 per cent of mortgages in the first quarter of 2009 were refused. If these had been approved, then the market would be looking a little less sickly.
He is also keen to address the disparity between loans that banks provide to buyers of new homes as opposed to older stock. Banks have been burned by bigger falls in the value of newbuild, and lending ratios reflect this.
Low admits housebuilders need to focus on "a better spread of types of property", while HFS takes the line that double-digit house price inflation at the height of the boom led to some housebuilders making "silly decisions".
Slater, who has worked with Low for several years, says: "He is a very capable individual. He has a wonderful mix of skills."
At 23, Low joined Stewart Milne after studying to become a quantity surveyor at Robert Gordon – then a technology institute rather than a university. He married Wendy the same year he took the job and they now have two teenage children.
"He has grown up in a business that has afforded him the opportunity to go through several departments, so he has experienced many elements of the housing sector. He has experienced the division through some challenging times in the past and probably the most challenging times we have at the moment," says Slater. "He's not shy at addressing the tough issues the sector and the industry will face. He is not afraid of standing up and being counted when other people are fearful of putting their head over the parapet."
A youthful 41, Low may have an advantage. Fair thinks HFS already has a suitable number of more senior "older, wiser" figures on the board.
"I am sure John would enjoy being called youthful. Youthful exuberance is not necessarily a bad thing to have. He has a lot of energy and vitality.
"That means in what is a spectacularly busy time for the industry in dealing with so many different issues, that youthful energy and enthusiasm can come to good use."
BACKGROUND
JOHN Low, 41, is managing director for Stewart Milne Homes North. A board member of Homes for Scotland since 2007, he has been elected chairman for 2009-10.
As vice-chairman for 2008-9, he chaired the organisation's Grampian committee and has played an active role in Homes for Scotland's engagement with the Office of Fair Trading on consumer issues and with the Royal Institute of Chartered Surveyors in connection with valuation practices.
Born in Aberdeen, Low spent some of his early years in Norway and Malta. On his return, he studied quantity surveying at Robert Gordon's Scott Sutherland School, joining Stewart Milne Group in 1990 as a quantity surveyor before progressing to land manager then land director.
He then became development director before he was appointed managing director in 2004.
Low is married to Wendy and they have two children.
