Understanding and responding to housing market change

Can public policy shape housing market outcomes to achieve wider social and economic goals or must it belatedly respond to mitigate some of the negative consequences of change?

This paper:

• summarises evidence, largely from studies funded by the JRF, on recent changes in the housing market in England at national, regional, local and neighbourhood levels
• highlights key challenges for developing public policies, intervention programmes and reforms.

Key points

• The move from tenure-centred to more market-centred analysis and policy development in housing is likely to intensify.
• Household migration between regions tends to compound rather than narrow social and spatial polarisation.
• Home-owners base decisions of whether, when and where to move not just on economic triggers but also on complex social and cultural aspirations.
• The sophisticated processes at work in housing markets demand an equally sophisticated policy response, combining financial, planning, housing and neighbourhood management measures. In more fragile markets, Housing Market Renewal Pathfinders have gone some way towards this: local authority and sub-regional partnerships need to apply new portfolios of measures for all local markets undergoing change.
• Strategies need to work across the market, rather than focusing on a particular tenure or policy sector. There is still a tendency for policies to ignore the interplay of pressures between tenures.
• Evidence of wholesale transformation of neighbourhoods from low- to high-value areas is scarce. Policies are likely to have more impact if they 'tilt' the market in certain directions, rather than attempting to reconfigure it. Steps could include:
  • more fleet-footed monitoring systems, to alert local and sub-regional agencies more readily to emerging market changes;
  • a more targeted approach to tracking the views of key groups;
  • an explicit hierarchy of measures for different local markets tailored to market type and function;
  • a more coherent social housing sector at sub-regional, district and neighbourhood levels, with a broader remit and extended strategic capability.