Save £380,000 on house prices by commuting
New report looks at commuting to London and other cities around the country
Alex Johnson has been part of The Independent's online team since 2007 and writes The Home Front property column. He has been writing about microarchitecture on his internationally-acclaimed website Shedworking since 2006 and is the author of three books, Shedworking: The Alternative Workplace Revolution, Bookshelf, and Improbable Libraries.
Friday 04 July 2014
Commuting to London by train rather than living near the office could save people hundreds of thousands of pounds, says a new report.
The Lloyds Bank study shows that many commuters in the South East make a 60 minute train journey with an average annual rail cost of around £5,000, but that they benefit from a house price that is on average, £380,000 lower than living close to their place of work in zones 1 and 2 in London.
For commuters to Birmingham and Manchester, house prices are often higher outside the city. The average house price in Birmingham is around £140,000, whereas Solihull, 15 minutes rail journey away from central Birmingham, has an average price of £274,257. Similarly, Leamington Spa, 30 minutes from the city centre, has a significantly higher average house price at £253,855.
The same applies to Manchester where an average house in the city is £134,873, lower than in Stockport (£192,172 and 15 minutes away) or Macclesfield (£231,118), Warrington (£173,581) and Chorley (£166,107) which are all half an hour from the city.
In terms of London, the report points to house prices in a selection of towns about an hour’s train journey away (including Crawley, Windsor, Brighton, Rochester, Peterborough and Oxford) which are on average around £260,000 compared to £641,000 for a property in an area within zones 1 and 2. It is also £134,000 lower than the average property price in zones 3 to 6.
Half an hour closer and house prices are higher, but not substantially so according to Lloyds. Commuters from towns in the ‘half hour zone’ pay an average house price of £283,000 and also come with a lower average annual rail pass cost of £3,719. Examples include Beaconsfield, Woking, Hemel Hempstead, Stevenage, Brentwood and Luton.
Even commuters whose journey is 15 minutes from central London, such as those living in Borehamwood or East Croydon, benefit from an average house price that is much lower (nearly £276,000) than in the central zones of the capital. The average cost of an annual rail fare in these areas is £1,986.
"It's no surprise, for London at least, that the further you commute, the more you save financially, even after travelling costs," said Marc Page, Lloyds Bank Mortgages Director. "However, quality of life is just as important a consideration for most and therefore trade-offs between type of property, schools, environment and time spent commuting all need to be weighed up carefully."
There are additional benefits for those prepared to travel longer distances to work in London though these come at a cost of a longer commute time and a significantly more expensive annual rail ticket. Commuters from Wolverhampton benefit from an average house price that is £484,000 lower than in central London but will need to endure a daily four hour round journey and an annual season ticket of more than £7,500.
In terms of numbers, Reading is the most popular station outside London for commuters into the capital (2.64 million commuters in 2012/13). There is a journey time of around 30 minutes, and an average house price of £290,358.
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