Rail, road and pedestrian accessibility is a key driver of house prices in the Northern Powerhouse, and property investors can use this to their advantage.
Researchers from the Institute for Transport Studies at the University of Leeds looked at how transport links make locations more attractive, in addition to ease of access to employment, school, local facilities and green spaces. The report is the first of its kind and was funded by Transport for the North, West Yorkshire Combined Authority and the Engineering and Physical Sciences Research Council.
Being able to walk to work has the most significant impact on property prices. On average, there’s a 3.61% premium for each additional 10,000 jobs within reach by foot, while there’s a 0.19% premium per 10,000 jobs accessible by car. This data shows the value of mixed urban developments across the north.
Rail access can add 14% to property prices. For every additional 10,000 jobs that are readily accessible by rail, there’s an average property premium of 0.16%, showing the impact investment in rail transport can have on the property market.
Past transport investment
The report also provided evidence that past investment in transport within the north has boosted the property market. The Manchester Metrolink extensions that have been constructed since 1995 were looked at as a case study.
These extensions increased prices of properties located near new stations by an average of 6.3%. Homes near the South Manchester Line saw an average increase of 10.5%, while the Airport Line had a whopping 20.9% increase.
The lead author of the report, Dr John Nellthorp, commented: “We can now clearly see not only the value urban rail systems bring in the property market, but the value of inter-urban connectivity in the north, and walk accessibility as well as by rail and car.”
Northern Powerhouse Rail
Prime Minister Boris Johnson has pledged to fund a new high-speed rail route between Leeds and Manchester, which is a part of the wider Northern Powerhouse Rail project. The full details of the route will be published after the independent review of HS2 is complete.
According to New Civil Engineer, the review of HS2 could recommend scrapping Phase 2b and putting the £24.8bn budget towards the National Powerhouse Rail project, which is expected to cost £39bn to implement.
The report by the Institute for Transport Studies at the University of Leeds details the potential impact of Northern Powerhouse Rail on property values across the north. The researchers state that the economy and fluctuations in the property market can impact property values. However, the initial projections reveal there’s the potential of up to 9.3% growth in land values in some areas close to rail stations that are expected to be improved by the Northern Powerhouse Rail project.
Dr Jack Snape, principal data analytics and modelling officer at Transport for the North, stated: “The research provides a robust body of evidence to help us build the case for investment in transport, and we can use this to inform the case for Northern Powerhouse Rail.”
Improving transport in the north of England is likely to boost the property market and increase property prices, especially in key areas near stations. Additionally, further investment is likely to make cities in the north even more attractive to live, work and invest in.
