Living near a landfill can reduce a home's value by 7 per cent

We always knew living near a rubbish dump was unpleasant. But it can knock more than £5,000 off the value of your house, a government study reported yesterday.

More than a million British homes are within half a mile of a landfill site. For the first time, statisticians have put a figure on their reduced attractiveness from all the associated dust, smells and noise.

The purpose of the study is to help the Treasury set the rising level of the landfill tax, which tries to restrict the amount of rubbish being disposed of in holes in the ground. But it was also to wake people up to the ever-growing cost of waste, Michael Meacher, the Environment minister, said. "There is an environmental cost but there is also a social and a personal cost, and they are significant," Mr Meacher said. "This study will increase our awareness that we can't be a throwaway society any more."

If you live within a quarter of a mile of a dump the average reduction in the value of your property compared with other local houses, the study shows, is 7 per cent, or £5,500 (there are regional variations). There are more than 200,000 homes in this category.

If you live more than a quarter of a mile away but still within half a mile, you can expect an average reduction of 2 per cent, or £1,600. In this category there are more than 800,000 homes. For Britain as a whole, the estimated total mean reduction in house prices within half a mile of a landfill site is nearly £2.5bn.

The study, by the consultants Cambridge Econometrics, used the Nationwide Building Society database of more than 500,000 mortgage transactions over the past decade and scrutinised about 50,000 where the houses were close to one of Britain's 6,500 operational landfills. It did not consider proximity to incinerators (of which there are 13.)

Mr Meacher said: "How we get rid of our rubbish is one of the pressing problems for modern society. The noise, the litter, the smells, the vermin and the visual scarring in neighbourhoods near landfill sites should be borne in mind by anyone watching their bin liners being thrown in the back of a dust cart.

"I'm sure it is an out-of-sight, out-of-mind issue for many. But for people living close to these sites it is a pressing issue, as it is for the Government."

People living near the Essex town of Mucking, which has a hard job living down its name because it has a 950-acre landfill site in its midst, agreed yesterday. "It's like living in a dustbin,'' said one resident, Pat Pease. "We didn't notice a smell when we first moved here but it's becoming more of a nuisance some summers, it's like living in an open sewer.''

Mrs Pease, 55, who has two children and bought her house for £13,000 with her husband, Bernard, 24 years ago, felt the Government ought to reimburse her the £5,500 drop in property value caused by living near a tip.

"The Government should give back the money we lose out on, seeing as they are the ones not listening to our pleas to have it closed down,'' she said.

The amount of waste Britain sends to landfill must be reduced by two thirds, under European law, by 2016, but it is still increasing. However, local authority recycling rates are now rising after decades in which Britain's recycling percentage was among the lowest in Europe.

Friends of the Earth called on the Government yesterday to back the recycling Bill of the Labour MP Joan Ruddock when it is debated in Parliament on 14 March. The Bill would ensure that every household in England and Wales was provided with a doorstep recycling service.