The delay to Crossrail is having a negative impact on nearby property prices, which is bad news for those who own property on the route, including buy-to-let landlords, new research shows.
Crossrail, Europe’s biggest infrastructure project, had been due to open in December 2018, but will not now open fully until 2020 at the earliest, which is bad news for some property investors.
Research for GetAgent.co.uk, the comparison website for estate agents, has looked at how delays in the delivery of Crossrail have impacted residential property prices along the route and how this could continue over the next couple of years.
Between the start of construction and the initial delays being announced in September of last year, the average house price along the route increased by 95% - up 0.8% a month on average.
When construction first started on the project in May 2009, the average property price around areas due to benefit with a Crossrail station was £305,442. Over the next nine years, price growth along the route exploded by 95%, an increase of 0.8% for each of the 112 months, putting the new average property cost at £595,061.
But since the announcement of these initial delays, which has resulted in three emergency cash injections with the cost of the route increasing from £14.8bn to £17.6bn, property prices near Crossrail stations have dropped by an average of 3.1%, which is equivalent to an average monthly drop of 0.8%.
With the latest delays until 2021 announced last week, an average monthly decrease of 0.8% would see just over £100,000 wiped off nearby property prices over the next two years, taking the existing average of £576,340 to £475,290.
Colby Short, founder and CEO of GetAgent.co.uk, said: “The turbulent ride for those living around stations due to benefit from Crossrail continues, as yet more delays are likely to see prices fall further.
“The Crossrail project is set to be a game changer when it comes to traversing the London landscape and the initial scramble to buy along the line brought some pretty meteoric house price increases. But as a consistent string of delays has set in, this urgency has seeped away and as a result, the high levels of house price growth have followed suit.
“Should this persist over the next two years, there could be a serious re-levelling of the Crossrail market. However, even if this were to ring true, the average Crossrail house price would still be some £170,000 more than when construction first started.
“Those living along the line should rest assured that the long-term benefits of doing so will far outweigh the current inconvenience of yet another London transport link failing to run on time.
“When it does open, the Crossrail influence is certain to bring high-speed house price growth with it and some areas, such as Liverpool Street, Gidea Park, Twyford and more, are already bucking the wider trends of political uncertainty to register strong price growth at present.”