Isaiah may be relating a parable, but he wants to make certain that it is understood. Thus, in verse 7 he declares that the vineyard is the house of Israel, and the vines themselves are the people of Judah.
Unlike the allegory in Jacob, which uses the branches of the olive tree to speak of dispersal and gathering, Isaiah uses this allegory to speak of initial destruction. The Lord of the vineyard is saddened by the wild grapes, and therefore tears down the protective wall. Remembering that Isaiah was the prophet during the Assyrian invasion, this allegory describes the destruction to the house of Judah that came as part of that invasion. It is probable that by the time Isaiah wrote this, much of the destruction had already happened. Perhaps Isaiah was quoting an older allegory and pointing out how it had been fulfilled.