In denial about a housing market recovery?

There is a conflict of evidence about housing market failure and recovery.   In Liverpool, HMRI advocates such as Brendan Nevin have pointed to anomalies in the market - such as divergence between upper and lower quartile prices - as evidence for continued failure.  On the ground, however, councillors hear about problems of affordability rather than collapse in house prices.

Fundamentally, if prices have recovered and are increasing since the CURS research half a decade ago, then "market failure" must have a very special and ideological meaning to those who continue to use the term.

There is scope for disagreement over movements in different types of houses, for example the Question to Council of October 2004.  But a report to the Regeneration Select Committee in December 2005 shows prices for terraced houses to be accelerating.  (To see the full report use EDR/291/05.)

It would be possible that there is or was a local problem in the Welsh Streets, but the evidence for that is thin.  In the Neighbourhood Renewal Assessment (Pennington March 2005) all we are offered is
REASONS FOR INTERVENTION 4.4 (page 27)
"There are some signs of outward migration for those who are economically able to move resulting in a more transient and less stable community. The market can, therefore, be said to be 'failing' because there is an oversupply of housing of a type and quality for which there is a declining demand in a location and environment that is currently perceived as undesirable."
This conjecture is the only market "evidence" in the Neighbourhood Renewal Assessment.  Unfortunately, Penningtons did not speak to the Welsh Streets Home Group, for example to inspect their register of buyers' interest.   If they had, they would also have been given evidence of frustrated inward migration of economically active households, due to the refusal of the major property holders - the registered social landlords to consider offers to buy empty houses.

The same paragaph actually offers reasons for the Council to pause for thought - an opportunity that so far has not been taken.
"...Views differ over the strength of the housing market and this would ultimately have an impact on the price of any intervention involving clearance. The implementation of any intervention strategy to underpin housing market failure clearly has to respond to the trends within the housing market which it is attempting to resolve."