Developments near a home can affect the property’s value. Some changes won’t make a large difference but others will have a major impact on property values in the area. Public transportation like bus stations, railways or metro transit systems, airports and even expansions of roadways make a large difference.
Why Do Public Transportation Developments Affect Property Value?
Public Transportation development can especially affect the value of a neighborhood mainly due to ease of access and better linkage to other places. This can happen with new bus terminals or rapid transit systems within close proximity of a neighborhood. Another factor that increases property price is road expansion. This is primarily due to ease of access and congestion in the neighborhood. All of these factors are highly desirable for people searching for a property.
Do All Developments Increase Property Value?
In most cases, property value does increase when public transport stations are integrated into a neighbourhood. The important factors are the size of the station, the distance of the property from the station, the effect on traffic congestion, and population density after the opening of the station.
How Does An Airport Affect Property Value?
Airports affect the value of residential and commercial property differently. Commercial properties such as hotels, office buildings and industrial spaces increase in value with an airport nearby, as they make access convenient. On the other hand, residential property’s value suffers from having an airport nearby, mainly due to noise pollution and traffic.
How Does A Bus Transit System Affect Property Value?
Research has shown that a bus station or terminal 100-400 metres from a house increases the property’s value. A high-rise apartment’s value can be increased by a bus station or terminal even farther away – within 800-1400 metres, although this effect can vary with the size of the bus terminal. If a property is too close to a large station, its value may decrease.
How Is Property Value Affected By A Rail Transit System?
Having a large railway system nearby decreases the value of a residential property primarily due to noise pollution and congestion, while rapid transit systems or metro lines will increase home values, as they provide faster and better linkage to the CBD.
How Is Property Affected By Road Expanisons
Whether a road expansion increases or decreases property values depends primarily on traffic. Freeways and expressways increase values, as they provide a direct link to major activity hubs or CBDs. However, if traffic activity increases in a neighbourhood due to road expansion, it has a negative impact on the property value.
Learn what other factors can affect property value here.
What Does The Current Public Transportation Infrastructure Look Like?
The existing transport infrastructure serves the inner cities well, but the outer suburbs face a lack of such infrastructure. People living in the outer suburbs of the big five cities benefit from lower housing prices but suffer from poor service and accessibility to public transport. More than 1.5 million people fall in this category in Melbourne, more than 1 million in Sydney, half a million people in Perth, and about 200,000 in Adelaide.
What Does This Mean For The Future?
There has been a significant increase in public transport infrastructure in the outer suburbs over the past years. The federal government has pledged to invest $100 billion in transport infrastructure from 2019-2029. New South Wales and the Victorian governments have pledged to invest $65.71 billion and $33.65 billion respectively. The investments in public transport will result in a significant increase in public transport accessibility, thus, increasing property value across areas where such projects will be implemented.
How Can I Use This To My Advantage?
If the right kind of development is planned for the neighbourhood where you plan to buy, property values can rise significantly; therefore, you need to know where and when developments are coming. Before buying, contact your broker and research the property and the neighbourhood.
Where Can I Search For Related Information?
One source of information related to development projects is the National Infrastructure Construction Schedule. You can also search the latest local and regional news for mentions of planned developments.
Our team of specialist mortgage brokers can help you buy a property. Contact us at 1300 889 743 or fill in our online assessment form and we will contact you.