A new study has revealed that living close to a tube or train station in London carries an enormous premium. The figures, from Nationwide, showed that buyers would pay £26,000 more for a property 500 metres from the station than they would for the same property £1,500 metres away.
But why is this, and how can we use this research?
ProximityProperties very close to the tube carry an average premium of 9% over those 1,500m away. Even a few metres makes a big difference, so those 750m from the station carry a premium of 6.3%, 1,000m away they are worth 4.1% more and 1,250m they're 1.9% more expensive than those past the 1,500m barrier.
It seems that 1,500m is something of a psychological barrier. Nationwide researchers pointed out that only 6% of London properties are this far from a tube or train station, and that these are mostly in outer boroughs of the capital, where people take more of a suburban approach, and leave their car at the station.
Why?The research perhaps shouldn't come as a huge shock. After-all, people are interested in the total length of their commute, and if they have to walk for an extra 15 minutes from the station, they may as well live a few stops further out and save some money.
However, the findings are useful for a couple of reasons. First, when you are buying a property, think about the transport links. Even if they are not so important to you, consider whether the area you choose is well connected and whether it will make it easy to sell the property on when it's time to move .
The second reason is that it can hold a clue to future house price movements in some areas, because transport improvements seem to have a striking effect on values.
Robert Gardner, Nationwide's Chief Economist, said: "The most recent addition to the London Overground network opened in December 2012, providing a link south from Surrey Quays to Clapham Junction via the Inner South London line. A London Overground service is now operating between Clapham Junction and Highbury & Islington, improving rail connectivity in the borough of Southwark.
"This appears to have had a positive impact on property prices in the area; Southwark was the best performing borough in 2012, with prices rising 11% over the year." Those with an eye on the long term could look at plans such as the Northern Line extension as an opportunity.
BroaderHowever, the tube is clearly just one factor. Nationwide also looked at the most expensive properties, and the average price of a house served by each line.
Gardner said: "The Circle line serves the capital's most expensive areas taking in much of central London and also parts of west London. Average house prices are over £650,000 in areas where the nearest station is on the Circle line. Average house prices are least expensive where the nearest station is on the Central line. Although the line passes through some of west London's pricier areas such as Notting Hill, it also serves some of east London's least expensive boroughs, such as Waltham Forest and Redbridge."
Average property prices near each line
|Hammersmith & City||£421,869|
|Docklands Light Railway||£361,600|