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In this paper an attempt is made to devise fairly simple formulae to aid local authorities in deciding between rebuilding and modemising areas of sub-standard housing. The choice is first examined in the case of an individual dwelling; then for groups of dwellings where the average cost of demolition and rebuilding falls as the proportion of dwellings in the area that are cleared increases. Finally, the case is examined where modemisation and rebuilding provide different amounts of accommodation and where the costs of providing overspill accommodation have to be allowed for.

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