Driven by regeneration? New geographic dynamics of foreign demand in English housing market

Purpose Recent changes in how locations and site features are selected are reshaping foreign investment patterns in housing markets. Factors such as urban regeneration, connectivity, and investment security are attracting international buyers, leading to a rise in overseas property acquisitions. This trend raises key questions: Does foreign investment promote economic growth, or does it strain local markets by inflating prices and reducing affordability? The challenge for policymakers and planners is to weigh the benefits – such as development and tax revenue – against potential drawbacks such as displacement and inequality, to manage housing markets sustainably in an increasingly globalised context. Design/methodology/approach Propensity score matching is used to construct a comparable group, minimising selection bias by accounting for observable characteristics. The nearest neighbour matching method pairs locations in the treatment group with the most similar counterparts in the comparison group. Statistical tests used to evaluate the quality and reliability of the matching process indicate that the mean differences between the treated and control groups are not statistically significant, as reflected by p-values exceeding the 5 % threshold. Additionally, the percentage bias remains below the commonly accepted 5% limit. To estimate the effect of the policy intervention, a difference-in-differences approach is applied. Findings In the baseline ordinary least squares regression, and in line with findings from existing literature, a 1% rise in house prices is associated with a statistically significant 1.33% increase in the share of properties acquired by foreign buyers. However, when controlling for both time and regional fixed effects, the magnitude of this relationship diminishes, with a 1% increase in house prices corresponding to a more modest 0.65% rise in overseas property purchases. Research limitations/implications While the study offers timely insights into the intersection of regeneration and foreign investment in England’s housing market, its conclusions are subject to data limitations, methodological challenges, and regional specificity. Nonetheless, the research has significant implications for urban planning, housing policy, and debates on equity in the era of globalised real estate investment. Originality/value This study is original in its exploration of how urban regeneration initiatives are reshaping the geography of foreign real estate investment in England. It bridges urban policy, spatial economics, and global investment studies to uncover new patterns of demand that extend beyond traditional markets. The research also provides timely, policy-relevant insights into the consequences of regeneration-led planning strategies in a globalised housing landscape.