YOU do not have to look hard to see the surge in housebuilding activity in Scotland at the moment.

At both ends of a drive down from the south side of Glasgow to Troon, there are giant housing developments under way on what were until recently greenfield sites, on the outskirts of Newton Mearns and at Barassie.

The length and breadth of Scotland, there are many, many other housing developments, large and small.

What a contrast from the days, in the depths of the 2008/09 recession, when sites had been abandoned by personnel and heavy equipment, often with houses only half-built.

If we needed any further confirmation of the much more positive state of the housebuilding sector, we could look to recent results from Scottish housebuilders Mactaggart & Mickel, Stewart Milne and Dawn Group.

Among the big UK housebuilders, Persimmon has also underlined its appetite for new housing developments in Scotland.

Mactaggart & Mickel chief executive Ed Monaghan last week highlighted a growing premium being paid for skilled labour and sub-contractors in the sector. What a contrast from that period, not so long ago, when housebuilding had ground to a halt and skilled tradesmen were driving taxis to make ends meet.

Mactaggart & Mickel announced last week that it had more than doubled its underlying pre-tax profits to £8.06 million in the year to April 30, from £3.4m in the prior 12 months.

Stewart Milne, after revealing this week that it had bounced back into the black in the year to June with a £3m pre-tax profit, highlighted hopes of doubling its annual turnover to about £400m over the next three years and voiced its confidence about the long-term strength of the housing market.

Dawn, for its part, reported a rise in profits in its housebuilding division.

So there is no doubt, from what you can see on the ground and from the figures and mood music from the housebuilders, that the sector is in much better health these days.

But bear in mind the context.

In this regard, it is interesting to hear pleas from Scottish housebuilders for sufficient future funding for the state-backed Help to Buy scheme. It seems to be seldom, if ever, that housebuilders on either side of the Border talk about the state of the market without citing the support provided by Help to Buy.

And we should not overlook the fact the housing market is getting a huge boost from UK base rates being at a record low of 0.5 per cent.

While recent signs of a significant cooling in the rate of the UK's unbalanced economic recovery are worrying, they have made it ever more likely that the first rise in base rates from their record low is still some way off. The growing expectation among economists is that the first rate rise will not come before mid-2015. The Monetary Policy Committee's decision to hold rates yesterday, at its latest monthly meeting, had been a foregone conclusion.

Such a benign outlook for rates, while the underlying cause should be of concern to us all and even to Chancellor George Osborne, will undoubtedly help support the housing market for a while longer.

Stewart Milne chief executive Glenn Allison this week declared that demand for new homes was running well ahead of supply on both sides of the Border, another supporting factor.

But the housebuilding sector and broader residential property market are not without their challenges.

These are evident in housebuilders' campaigning on the Help to Buy front.

Meanwhile, housebuilders, as well as homeowners, are facing major change with the impending switch in Scotland from stamp duty to the new land and buildings transaction tax.

This might help first-time buyers. However, those buying properties for more than £325,000 will pay more tax.

Stewart Milne highlighted the fact that many properties in cities such as Edinburgh and Aberdeen were selling for more than £325,000.

There are signs that growth in the housebuilding sector, while still strong, may be cooling a bit. This is probably no bad thing.

However, there will undoubtedly be greater challenges ahead, not least when interest rates do start to rise, especially given that real household incomes have been falling for years.

The supply and demand argument carries some weight. But history warns us that affordability, in terms of people's ability to meet their mortgage payments, ultimately holds the key to the housing market's fortunes.