Counter-Urbanisation, Planning and House Prices: An Analysis of the Aberdeen Housing Market Area, 1984-2010

Article excerpt

Counter-urbanisation has been a continuing trend within the UK since the 1970s. This presents challenges for both urban and rural planners. The paper considers potential interdependences between spatial housing submarkets associated with counter-urbanisation, and highlights the economic factors which will influence the pattern of price effects across the market system. Empirical analysis focuses on the Aberdeen housing market area, split to distinguish between the city centre, suburb and accessible rural areas where the latter are within commuting distance of the city. A vector error correction model is used to identify the long-run interdependencies between each submarket. We find evidence of spatial price transmission between housing submarkets consistent with a direct city to rural rather than cascading counter-urbanisation process. The prices in the suburb area are found to adjust most rapidly should prices diverge from the long-run equilibrium. The results confirm the importance of planning frameworks which transcend rural-urban and, in this case, local authority boundaries. In the light of the findings, the paper considers the role of planning in mediating market impacts associated with counter-urbanisation.

Keywords: housing submarkets, counter-urbanisation, vector error correction models, price dynamics

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Introduction

This paper considers the relationship between within-region population redistribution, house prices and housing planning policies. Since the middle of the twentieth century, the UK has seen ongoing shifts in population from cities to less densely populated areas. In particular, a 'counter urbanisation cascade' has been identified (Champion, 1998; 2005) whereby the more densely populated an area, the greater the level of out-migration. Although the pattern of change appears complex, more recent evidence suggests that migration away from the largest cities is continuing (Allinson, 2005).

The movement of population from cities was first associated with industrial restructuring and was facilitated by changes in transport infrastructure (Massey, 1984; Berry, 1980; Boyle, 1995; Keeble and Tyler, 1995). More recently, there has been recognition that counter-urbanisation reflects a growing preference of some households for rural lifestyles. While retirement and long-distance commuting is a feature for some more remote rural areas, the majority of moves from urban to rural areas have been associated with an increase in commuting between contiguous rural and urban locations, reflected in expanding travel to work and housing market areas (Hincks and Wong, 2010).

Population movements outward from city centres present challenges for both urban and rural planners. There are potential costs for urban areas experiencing a net loss in population in terms of surplus housing, over-capacity in public infrastructure and neighbourhood decline and abandonment (Turok, 1999). Concern with such issues led to the government's 2000 Urban White paper calling for an 'urban renaissance' and a major shiftin planning approach including targets for brownfield developments (DETR, 2000). For rural areas, a key concern is the impact of counter-urbanisation on housing affordability (Barker, 2004). In particular there are concerns that local people are 'priced out' of rural housing markets due to high income urban in-migrants (Champion, 2009; Taylor, 2008). Although recent evidence suggests that the affordability of housing in rural areas is less of a problem than previously suggested (Bramley and Watkins, 2009; Coombes, 2009), counter-urbanisation can lead to locals facing adverse house price movements (Liu and Roberts, 2012). This is exacerbated by the low levels of social housing provision in rural areas and the constraints on the supply of new housing associated with the planning system (Lewis et al., 1991; Sturzaker, 2010). In addition, counter-urbanisation has been linked to negative social effects related to both the anti-development stance of incomers (Murdoch and Marsden, 1994) and the environmental consequences of increased commuting (Banister and Gallent, 1999). …