Can the Market Provide Housing for the Poor

Since the last century, population growth has been concentrated to urban areas in Sweden. In an attempt to provide affordable homes for the new urban population, Sweden constructed approximately one million new homes between 1964 and 1975. However, the construction rate plunged thereafter and there is now a shortage of housing in many cities. Moreover, newly built homes have become accessible to a more limited group of people. The filtering theory predicts that over time, as homes deteriorate, they will filter down to low-income individuals through moving chains. The filtering speed plays a crucial role for the availability of affordable housing for low-income individuals. If the speed is high, homes can be efficiently provided to disadvantaged groups via the market. With data over the entire population and all properties since 1990, we can better than before investigate the role of filtering in providing housing for the poor.


Che-Yuan Liang
Oscar Erixson