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Counter-urbanisation, filtering, and dynamics changes in urban rural housing submarkets

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Counter-urbanisation, filtering, and dynamics changes in urban rural housing submarkets Nan Liu ... 2000, analysis of the Scottish rural housing market). – PowerPoint PPT presentation

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Title: Counter-urbanisation, filtering, and dynamics changes in urban rural housing submarkets


1
Counter-urbanisation, filtering, and dynamics
changes in urban rural housing submarkets
  • Nan Liu
  • Research student in Property
  • University of Aberdeen Business School

2
Background and motivation
  • Counter-urbanisation population flows from urban
    cores to rural areas, caused by
  • The change in residential preferences of
    working-age people
  • The expansion of commuting fields round
    employment centres
  • Improvements in transport and communications
    technology
  • The emergence of scale diseconomies and social
    problems in large cities
  • The growth of employment in particular localised
    industries (e.g. tourism)
  • The acceleration of retirement migration etc.
  • Source Champion 1988

3
Background and motivation
  • Consequences in the housing market
  • Locals are believed to have been priced out of
    the housing market by incomers (Shucksmith, 1981,
    case study on the Lake District area)
  • outsiders occupy second home and retirement
    home, competing for residential property, the
    price of housing has escalated well beyond the
    reach of most Padstonians (Gilligan, 1987, case
    study on Cornwall)
  • Incomers purchase property from all segments of
    the housing market and therefore have increased
    the demand for all housing (Stockdale et al,
    2000, analysis of the Scottish rural housing
    market).
  • Such research however, overlooks changes in
    market dynamics in different submarkets (both
    quality and geography), and its impact on other
    submarkets lacks quantitative evidence.

4
Prime research aim
  • To investigate changes in urban and rural
    house prices and housing stock by tracking the
    changes in market dynamics resulting from
    counter-urbanisation.

5
Research framework
6
Traditional filtering models
  • Determinates
  • Cross price elasticities for demand
  • Quality quantity of new constructions.
  • (Galster Rothenberg, 1991)

7
Spatial filtering theoretical analysis
  • Underlying assumptions
  • Population only flows from urban areas to rural
    areas
  • Population flows from the urban high quality
    submarket to the rural high quality housing
    market
  • Deteriorations effect on dwellings filtering
    process is embodied in the decision of upgrading
    and downgrading

8
Spatial filtering theoretical analysis
9
Spatial filtering theoretical analysis
  • Filtering in the urban areas (medium run)
  • In UH quantity decreases, price change
    ambiguous, dwellings downgrade
  • In UM quantity and price change ambiguous,
    dwellings downgrade, households filter up
  • In UL quantity change ambiguous, price
    decreases, lowest quality housing gets
    demolished, households filter up.

10
Theoretical analysis
  • Filtering in the rural areas (constrained
    constructions)
  • In RH quantity increases, house price increases
  • In RM quantity decreases, house price increases,
    houses filter up
  • In RL quantity decreases, house price increases,
    houses filter up.

11
Theoretical analysis
  • Filtering in the rural submarkets (allowing new
    construction in all quality markets)
  • In RH quantity increases, house price increases
  • In RM and RL both quantity and price changes are
    ambiguous depending how much contraction takes
    place
  • House still filter up, households filtering is
    possible if supply functions in RM and RL shift
    to the right.

12
Some initial findings on Aberdeen city and
Aberdeenshire
  • Location Northeast Scotland
  • Urban oil and gas industry based
  • Experienced counter-urbanisation
  • House price in some rural areas increased
    dramatically.

13
Migration, households, and housing stock in
Aberdeen city and Shire
The region experienced population flows from the
urban to rural areas
  • Both city and shire gained in number of
    households
  • Surplus housing stock exists in both market
  • The city has more surplus stock.

14
Data and limitation
  • Aberdeen Solicitors Property centre data
    (1984-2008)
  • Information regarding existing housing stock
  • House characteristics, price and location
  • Repeated sales
  • No information on households
  • Limited information on new house buildings.
  • New construction data from the central
    governments statistics (1986-2008)
  • Private new house buildings start completion
    date
  • Location (settlement)
  • No indication on dwelling type/price
  • No information on council/housing association
    completions

15
Some findings
  • Repeated sale data categorised into four quality
    submarkets
  • Second sale compare to the first sale

16
Physical change
  • Data shows evidence of physical change
  • 27 of the repeated sales experienced increase in
    total number of rooms 11 had total number of
    rooms reduced
  • Difficult to conclude whether change in quality
    submarket is caused by upgrading/downgrading.

17
New construction
  • Constructions take place in all submarkets
  • More dwellings have been built in the rural areas
    than in the city
  • Evidence shows degrees of constraint on
    constructions in both urban and rural areas

18
Conclusion and future research
  • Theoretical analysis suggests
  • rural households MIGHT be forced out as a
    consequence of counter-urbanisation, depending on
    the construction activity
  • low income groups in the urban area will benefit
    from the phenomenon
  • Both quantity and price in all submarkets will
    change
  • Both house and household filtering take place.
  • Empirical analysis suggests
  • A certain level of house filtering take place
    (e.g. house change quality submarket, and
    physical change do occur)
  • New construction do take place
  • Limitations require more comprehensive data (BHPS
    data)
  • Policy implication urban and rural should be
    considered as a whole

19
Theoretical analysis
  • Supply adjustments in the medium run
  • New constructions takes place when the gap
    between cost and price is the largest

20
Theoretical analysis
  • Supply adjustments in the medium run
  • conversion (upgrading and downgrading) takes
    place when there is opportunity to increase
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