Research by Nationwide on transactions between April and March showed properties in the capital located 500 metres away from a metro or railway station attracted a 9.7 per cent price premium – equivalent to £46,800 based on average London prices – over a similar property 1,500 metres away.
The lender said that the price premium reduced with distance as properties 750 metres away attracted a 6.8 per cent premium, properties 1,000 metres away garnered a 4.3 per cent premium and those 1,250 metres away secured a two per cent premium.
This price premium is a slight increase on pre-pandemic levels, as in 2019 and 2020 a property located 500 metres away from a metro or railway station had an 8.6 per cent premium over a comparable property 1,500 metres away from a station.
The willingness of Londoners to pay a premium for closer access to public transport was attributed to greater reliance on public transport and reduced likelihood of residents to drive.
Nationwide senior economist Andrew Harvey said: “The pandemic does not appear to have reduced the desirability of being close to a station in London, despite reduced public transport usage. Indeed, our analysis suggests the premium has actually increased slightly compared with pre-pandemic levels.
“We’ve also seen a noticeable increase in the premium to be located close to a station in the Greater Glasgow area, but in Greater Manchester, homebuyers appear to be placing a little less value on being close to a rail or tram stop compared to before the pandemic,” he said.
In Glasgow, homebuyers paid a 7.2 per cent price premium on properties 500 metres from a station, equivalent to £11,400, over a similar property 1,500 metres away. This is around double the price premium in 2019 and 2020 which was 3.2 per cent.
Harvey said: “It is perhaps surprising that the premium for transport links in Scotland’s largest city has increased despite the reduction in public transport usage. But it would appear to suggest that those who are buying do still value these links and expect to use them again in the future.”
In Greater Manchester the price premium on properties close to public transport links fell by 2.9 per cent to 6.1 per cent. This is equal to £11,000 according to Nationwide.
Harvey noted: “While we can’t be certain why the premium has fallen, it is possible that priorities for homebuyers in the Greater Manchester area have changed during the pandemic, with a greater emphasis placed on things like local amenities and access to outdoor space.”