Mobility Constraints and Cycles in the Owner Occupied Housing Market

ABSTRACT Very little empirical attention has been given to the mobility constraints linked to accessibility to and upgrading within home ownership. Both are central to the operation of the housing market and can be seen within a framework of housing careers. This paper places them also in the context of changing housing market conditions and in particular the role of housing cycles. The research simulates, in purely financial terms, the behaviour of the average first-time buyers in each region of the UK over three decades. The analysis finds the accessibility mobility constraint is more psychological than financial but is also dependent on interest rates and the scale and duration of market downturns. The analysis of the upgrading constraint through housing cycles demonstrates that the ease of moving in the upturn fuels a boom but the subsequent inabilities to accumulate the capital necessary for such a move brings a long muted recovery.