In this paper, a purely displacement‐based formulation is presented within the framework of the scaled boundary finite element method to model compressible and nearly incompressible materials. A selective reduced integration technique combined with an analytical treatment in the nearly incompressible limit is employed to alleviate volumetric locking. The stiffness matrix is computed by solving the scaled boundary finite element equation. The salient feature of the proposed technique is that it neither requires a stabilization parameter nor adds additional degrees of freedom to handle volumetric locking. The efficiency and the robustness of the proposed approach is demonstrated by solving various numerical examples in two and three dimensions.