Ministers have been warned that a homelessness crisis will become deeper after it emerged social landlords in Scotland are expected to build 4,500 fewer affordable homes for some of the nation's most vulnerable than planned over the next five years.

Concerns have been raised about how the nation will deal with the housing emergency as the housing regulator has warned registered social landlords are projecting a 15% reduction in their plans to build new homes over the next five years as they seek to make spending cuts.

It has led to new concerns over a potential failure to meet a Scottish Government target over the provision of affordable homes. It comes as the number of new social sector housing building starts has slumped to a seven-year low, with 3665 due to begin in 2023, according to official figures.

Scotland's Housing Regulator says landlords are also planning to cut back or delay investment in existing homes with £15m cut from spending plans in some of the next five years.

It comes in the wake of what they called "tough spending decisions" being made as landlords deal with rising costs and government-imposed curbs on rent rises.

In an analysis, seen by the Herald, the regulator has said that while social landlords have made "significant efforts" to cut rent rises but that "this will have resulted in landlords having less resource available in the current year and in future years to invest in tenants' homes and service, and in providing new homes."

READ MORE: Appeal for more Glasgow homes to let in homelessness 'meltdown'

The Scottish Government's Programme for Government made a commitment to delivering 110,000 affordable homes by 2032 of which at least 70% was to be available for social rent. The commitment to build 110,000 affordable homes was made in the 2021 Programme for Government after the SNP and Greens signed a powersharing deal.

The Herald:

It comes as official figures showed that more children than ever are homeless and living in temporary accommodation for the homeless in Scotland.

As of March this year, 9,595 youngsters were in the system - the highest since Scottish government records began in 2002.

In total, there were 29,652 open homelessness cases in March, which was a 15% rise on last year.

Meanwhile, homelessness applications increased by 9% in 2022-23 while there was a 1% drop in cases being closed.

The Scottish Tenants Organisation said the cuts on social rented home building would make it far more difficult to hit the affordable homes target and take the homelessness emergency into deeper levels.

"Local authorities and housing associations have to be given the additional hundreds of millions of pounds through grants, extended borrowing and additional taxes on the rich to build the thousands of social rented homes needed to finally end the scandal of homelessness and large waiting lists in Scotland. We must end the tragedy of thousands of homeless children growing up in destitution and squalid accommodation," the organisation said.

First Minister Nicola Sturgeon announced a rent freeze in September, last year to help private and social tenants in a cost of living crisis.

But it was replaced by a 3% rent cap for private tenancies only in April which was to remain in place till the end of this month.

A further six-month extension was agreed by ministers meaning landlords with properties within Scotland will continue to face restrictions to rent rises until March 2024.

Ministers were accused of betraying the poorest in Scotland in the cost of living crisis by not extending the cap to those renting from social sector landlords such as councils and housing associations who tend to provide lower cost accommodation taken by the poorest and most vulnerable in the country.

The Herald:

But in March it emerged that rents in Scotland in the social rented sector had risen by up to 8% while those in the private sector were capped at 3%.

Rent rises approved by over 100 housing associations in Scotland hit an average of 5.34% and ranged between 0% and 8%. The typical rent rise in homes controlled by local authorities was at 3.8%.

The housing regulator said social landlords had made "significant efforts" to minimise the level of rent increases.

Meanwhile a group of council chiefs and senior managers said that Scotland faces a "critical lack of capacity" in social housing.

The Society of Local Authority Chief Executives, in a July analysis, says that the supply of affordable homes has fallen 20% in three years and "shows no sign of recovering".

They say at least 125,000 homes for social rent were needed simply to satisfy existing demand.

Its July analysis revealed that 243,603 people are currently on the waiting list for social housing, but only 26,102 allocations were made across the entire country.

Aditi Jehangir, secretary of the Living Rent campaign group said: "Everyone agrees that Scotland needs more social housing in order to end housing insecurity. And yet, every bit of research shows the opposite is happening. The housing and homeless crisis is already drastic but with the decrease in new social homes being built, we are heading from a crisis to a nightmare. The government just needs to fund social housing associations to build more social homes.

"Social housing providers and the government need to take responsibility and stop the blackmailing game with tenants: we need to raise your rents to build, instead of having proper capital funding investments.

"We all deserve the security and safety that comes with having a stable, affordable home. And building more social and council housing needs to be a priority."

Last year the Scottish Government met its target of building 50,000 affordable homes a year later than expected.

Official analysis showed that the ambition was achieved in March 2022, after 9,757 affordable homes were delivered in 2021/22 – the highest figure in a single financial year since 2000/01.

The original timescale of delivery by March 2021 was said to have been hit by “significant challenges” presented by the pandemic and subsequent lockdowns.

Sean Clerkin, STO campaign co-ordinator added: "Cuts to social sector house building are going to make the housing and homelessness emergency even worse than it currently is.  Urgent action has got to be taken."

Last week concerns were raised that the number of affordable homes being approved for build has slumped to the lowest level for ten years.

Some 6,042 homes were given the nod for grant funding in the year to the end of June as part of the Affordable Housing Supply Programme - down by 22% (1724 homes) on the 7666 approved in the previous year and the lowest equivalent annual figure since 2013.

The number of affordable homes started has also dropped in the year from 7,304 to 7,124 and is at its lowest level since 2016.

Meanwhile the Scottish government has said it intends to extend the 3% private sector rent cap for a final time until March 31 and Tenants’ Rights Minister Patrick Harvie assured MSPs that it would “bridge the gap” for tenants once the emergency legislation expires.

He said it recognised landlords might want to increase rents all at once following the expiration of the Cost of Living (Tenants Protection) Act and has therefore got the power to put rent adjudication procedures in place to facilitate the transition.

Housing Minister Paul McLennan said: “We are investing £3.5 billion over this parliamentary term to support delivery of 110,000 affordable homes by 2032, 70% of which will be for social rent.

“The number of affordable homes completed in the latest year is the highest annual figure since 2000. From April 2007 to end June 2023, we have delivered 123,985 affordable homes, over 87,000 of which were for social rent, including 22,994 council homes.

“Despite challenges including Brexit and the coronavirus pandemic, since 2007, Scotland has seen over 40% more affordable homes delivered per head of population than in England, and over 70% more than in Wales.”