According to the Western European city thesis, European cities have a unique institutional mix which helps to explain how social patterns come about. The most important elements of this mix are the interventionist state and the housing system legacy of non-private housing. While these two are vital, overall generalizations are tricky due to regional variations in economic performance, housing markets and local state capabilities. This paper explores the generalizations that can be made about the institutional context of direct interventions in the built environment and housing, i.e. neighborhood regeneration, in Western European cities. It examines how national policy frameworks and housing market characteristics impinge upon on the adoption of social transformation strategies. Social transformation strategies, often adopted in neighborhood regeneration, refer to the use of physical interventions to institute social change in deprived areas. Generally, there are two types of social transformation strategies: large-scale tenure restructuring and upgrading. A comparative analysis of four cases of regeneration shows that in Western European cities the opportunities and constraints of national policy framework and regional housing market characteristics help to explain the social transformation strategies adopted locally. Furthermore, it shows that the thesis’ value as an explanatory and analytical framework for Western Europe. Since Rex and Moore’s study of Spark brook (1967), it has become a commonly accepted notion that to understand patterns of social and spatial differentiation within cities (segregation, gentrification, suburbanization, etc.), one should take a measure of the institutional context in order to explain variations across space. There are multiple strings of research, which theorise, typify, describe and explain differences in norms, rules, regulations and in political and institutional arrangements between localities. Important examples of comparative frameworks on a national level include welfare systems (e.g. Esping-Andersen, 1990, Gould, 1993), housing systems (e.g. Balchin, 1996, Boelhouwer and Van der Heijden, 1992, Murie, et al., 1976).