Crossrail, London’s major transport innovation, is already having an impact on the property market with transactions within 500 meters stations increasing by 23% last year.
Also, within a mile of the stations sales are up by 21%, both significantly exceeding the London average of 13%, according to new research from Hamptons International.
The research report analyzed activity and prices along all stations on the Crossrail line to identify its current and projected impact on local housing markets.
The research reveals that 2013 marked a turning point in housing market activity in close proximity to London’s Crossrail stations with transaction growth accelerating well beyond London averages for the first time since construction began.
By contrast, since 2009, transaction growth has been closer to London averages, with transactions within 500 meters of Crossrail stations growing by 54% and within a mile by 44% compared with a 52% increase in transactions across London generally over the last five years.
‘The broader recovery of London’s housing market in 2013 has proved fertile ground for a Crossrail effect to emerge. Housing market activity in anticipation of Crossrail has spread to most stations along the line and nearly one in 10 home sales in 2013 were within a mile of a Crossrail Station,’ said Johnny Morris, head of research at Hamptons International.
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‘However, while many markets are seeing a hive of Crossrail activity, the muted price growth around some stations indicates there are still many opportunities for savvy investors. Stations to the East and West of Central London, in line for radical improvement to commuting times, are best positioned to benefit from the Crossrail effect,’ he explained.
.Many East London markets experienced a Crossrail effect for the first time in 2013 but for stations further along the line, growth has been limited to the areas closest to the stations. In West London, the higher value markets of Acton and Ealing have already seen a large impact from Crossrail but the effects of the project are steadily spreading across the line. For example, Maidenhead, the last stop on the route, is starting to see more purchaser activity buoyed by Crossrail,’ he added.
Crossrail effect areas in Zones Two and Three in London, which will see commuting times fall to under 20 minutes, have seen the most impressive increases in transactions. Within 500 meters the number of transactions has increased by 116% since 2009 compared with a London average of 52%. By contrast, price growth in these areas has risen just 17% compared with the London average of 26%.
While Zones Two and Three have seen the largest growth in housing market transactions so far, Crossrail will substantially cut journey times from a number of stations within Zones 6 and 7 on the edge of London, firmly cementing them as commutable locations. While transactions have grown in these areas the effect has been so far limited to within 500 meters of stations.
‘A drop in journey times to Central London to 20 minutes or less is a really big market driver. It’s these markets that stand to see some of the biggest impact from Crossrail in the short term,’ said Morris.
Crossrail has had a similarly significant impact on the residential development market, particularly in Central London, which is home to two thirds of new homes sales along the Crossrail route.
Since 2009, one in five new homes sales in London was within a mile of a Crossrail station. Canary Wharf in particular has seen almost 2,000 new homes sales within a mile of the station, accounting for a quarter of all new homes built along the route so far. There will be a Crossrail ripple effect on the new homes market too with confirmed schemes in Woolwich, Maidenhead, Ealing and Southall.
‘Crossrail has already stimulated much investment in new homes along the lines, unlocking previously unviable schemes and driving regeneration in new areas. Over the long term, the areas that stand to gain most are those that have complemented the new Crossrail link with regeneration and development,’ said Nick Vaughan, head of residential development at Hamptons International.
This article was republished with permission from Property Wire.