Should the state intervene in the housing market The case for a visible hand in housing market renewal

1. Should the state intervene in the housing market? The case for a �visible hand� in housing market renewal Ian Cole CRESR Sheffield Hallam University

2. HSA Conference University of York 19/20 April 2006 A first thought��.. �Our analysis leaves us to believe that recovery is sound only if it does come of itself� (his critique in 1934 of Roosevelt�s New Deal) Schumpeter, J The Economics of the Recovery Program 1934 p20, quoted in Galbraith, JK (1992) p5

3. HSA Conference University of York 19/20 April 2006 Outline of Presentation The origins of state involvement The all-pervasive �market� Market blind spots How not to do market renewal? A case study The opportunities for state intervention in market renewal �and the threats

4. HSA Conference University of York 19/20 April 2006 This is where we began� state involvement in infrastructural support to market the �housing question�: different routes to enable affordability and minimum standards council housing as a corrective to housing supply ..whether in new build or clearance/redevelopment Atlee government backed out of tighter controls over access to finite resource: land whole debate became skewed around consumption strengths of the state (design, dwelling standards) ..overshadowed by focus on weakness (management and maintenance)

5. HSA Conference University of York 19/20 April 2006 The �state� and the �market�� false dichotomy complex interdependence idealisation of the market� but not now with the state consistently permeated with market �logics� housing as acid test.. straddling the �personal� and the �political�

6. HSA Conference University of York 19/20 April 2006 The all-pervasive market� unchallengeable? ..but was not for Adam Smith equilibrium as default mechanism cramps and distorts diversity of human motivation ignores multiple ways we engage with plurality of markets (Susan Smith)

7. HSA Conference University of York 19/20 April 2006 What the �market� does well? diversifies provision responds to consumer preferences increases choice provides greater efficiency and value for money (adapted from Bramley et al, 2004)

8. HSA Conference University of York 19/20 April 2006 But� diversifies provision �but what about �bandwagon effect�? responds to consumer preferences �.but price as outcome not cause? increases choice �.for some provides greater efficiency and value for money �.more than the �product� is involved

9. HSA Conference University of York 19/20 April 2006 �Market� blind spots time space the �household�.. ..and its preferences consequences for �sense of community� institutional logics

10. HSA Conference University of York 19/20 April 2006 Time hollowing out of urban core in Northern cities coupled with progressive deindustrialisation of manufacturing towns thirty to forty year process at least the �market� doesn�t do �restructuring� �unless can see the advantage exposes the �quiet theology of laissez-faire�

11. HSA Conference University of York 19/20 April 2006 Space those cities and towns untouched by recent investment: marginal to the search for new terrains for market growth steady growth of segregated neighbourhoods, districts, sub-regions overlooked in housing policy focus on relative tenure size etc and ignored due to relative absence of collective unrest

12. HSA Conference University of York 19/20 April 2006 The �household� and its �preferences� assumed economism in motivation and gendered bias in assumptions on decision-making �trigger� mentality assumed for (eg) mobility ignores complexity behind mobility�and �immobility� too �diversity� in provision often a charade: but �monolith� is reserved for the public sector

13. HSA Conference University of York 19/20 April 2006 The future of �community� market response to demographic and social change? � more segregation moving towards an �enclave society�? distorted view of community is advanced but the �mixed� community is essential to functioning urban system.. who will clean up the mess if not?

14. HSA Conference University of York 19/20 April 2006 Institutional logics? The examples of lending and development John Kay � small stories not grand narratives: decentralisation of decision-making is key deregulation has removed the fig leaf of �social responsibility� for mortgage lenders corporate system has triumphed, while remaining under the mantle of �the market�

15. HSA Conference University of York 19/20 April 2006 The Changing Profile of UK Mortgage Lending

16. HSA Conference University of York 19/20 April 2006 ..the opportunities for market renewal? Intervening where the state should? operating according to market dynamics not administrative convenience dealing with long-term consequences and vision co-ordinated response, not left to vagaries of market opportunity multi-level approach coupling investment with community support �re-imagining� urban spaces showing the �market� how to take risks

17. HSA Conference University of York 19/20 April 2006 ..and the threats? not long term enough: holding political nerve lack of control over land use and ownership replacing one form of economism with another lack of support and innovation at central and regional levels the �heritage� lobby and the BNP

18. HSA Conference University of York 19/20 April 2006 The Alternative to HMR? 150 years on, will the market step in?? If not: community marginalisation and dislocation urban dysfunction �conservation� of 19th century standards for housing the poor an overcrowded South � the main threat to the culture of contentment?

19. Should the state intervene in the housing market? The case for a �visible hand� in housing market renewal Ian Cole CRESR Sheffield Hallam University