Resolving the paradox of market renewal

This is no ordinary resident and no ordinary estate. Employed by the Church of England, this man and his family moved to the estate several years ago to help local residents meet their day-to-day needs, both material and spiritual.

They live on the largest council estate in Western Europe. It was the victim from birth of a disastrous Radburn layout. Nearly half the houses are now vacant and boarded up and no buses come onto the estate. The remaining residents are simply non-viable in a deregulated world, so they are effectively cut-off, 200 yards from the countryside and five miles from the city centre.

The housing is simple and solid. Parker-Morris space standards, brick-built, it will probably last another 30 years at least, longer with a proper maintenance regime. But hardly anyone wants to live here. With 20,000 surplus social housing units in the city and a population still declining, tenants can exercise choice – and they choose to live elsewhere, closer to the city centre.

At the other end of the estate, new market housing is being developed at a rapid rate. In design terms it's second-rate stuff – "could-be-anywhere" houses. The space standards are probably not as generous as the council houses. But what do I know? The punters are lapping them up as fast as they can be built. And the housebuilders want to build more.

So is this the no-brainer it seems? Knock down the half-empty council estate that's wasting brownfield land and full of social problems, move the remaining tenants into surplus stock elsewhere, raze the place to the ground, and give it to the private sector?

My sacrificial friend pouring the tea would dissent. Indeed, he has plans stuck to his kitchen wall, the product of consultation with the estate's remaining residents. They include a map he has drawn in which some housing stays, some housing goes. In urban design terms, I tell him, it makes little sense, with housing retained according to individual preference. He shrugs. He'd like to do some proper designs but nobody from the council is interested, no money is being put forward; the residents just have to do the best they can with their felt-tips and tracing paper.

Does the lack of interest mean the institutional world has already made its tactical withdrawal in advance of the bulldozers? Perhaps, but then – what's that building being erected right in the middle of the estate? It's a spanking new Sure Start centre. Surely that's a sign of continuing commitment to one of the poorest wards in Britain?

This story reflects the complexities and contradictions of housing market renewal.

Market renewal must be about equalising supply and demand in areas suffering from population haemorrhage. But can local authorities in these areas make the hard decisions that will affect many individuals and obliterate some communities forever? How will they transcend the turf warfare of ward politics? Who will do the spatial planning needed to make sense of the market renewal process?

If we attempt major surgery on our urban areas without comprehensive, flexible plans, we will end up wasting public resources in the same way we've been doing for much of the past; on thinning out and infill schemes that ease the pain but provide no long-term solution, ending up with fewer residents who cannot support local services, surrounded by "public space" that nobody can manage or make sense of.

Housing market renewal is paradoxical. We need fewer houses but more density; we need to build more compactly. In each renewal area, we should be creating a network of mixed-economy, mixed-tenure neighbourhoods full of people with sufficient combined economic clout to support local services. In between these neighbourhoods, we could create parks and playgrounds.

Are we bold enough to take the necessary action at any level of government? My friend across the table seems to have a spiritual vision for his community. I see few signs of a physical manifestation.