The construction of a new bypass adds an average of 15% to the value of homes in the town or village that benefits, though local house prices can be boosted by as much as 30%, new analysis from property adviser Savills, shows.
A report by the company’s residential research team analysed the impact of house prices in 24 locations in the UK where a bypass has been opened in the past ten years. The team has studied house sales recorded by the Land Registry to calculate the uplift in value for affected properties before and after the construction of the bypass.
Overall, residents of towns and villages freed from the blight of through traffic thanks to the construction of a bypass gain an average 15.3% boost to the value of their homes in addition to any underlying market led price movement in the wider area.
The report also found this value boost occurs very soon after construction and prices then revert to behaving in line with average price movements within their region. A study of properties bought and resold within two years before and after the opening of a bypass showed an almost immediate average 13.8% boost to values.
This contrasts with other major transport improvements where there is usually a degree of property speculation when the project is announced, followed by progressive price growth, as wealthier demand is drawn to an area over time in anticipation of improved connectivity. In the case of a bypass, the traffic blight remains until the bypass opens and values appear to remain suppressed as a result.
The bypass uplift varied significantly according to location, but is evenly distributed at an individual town or village level. The limited number of house sales at a small village level makes analysis unreliable. In locations, though where there is evidence based of at least 100 sales around the opening of a bypass, the average uplift in values has ranged from 9% to 30% depending on location, with the greatest uplift seen in Rothwell, Northamptonshire. This was attributed to the construction of the A6 bypass.
Shavington in Cheshire saw house values increase by 27% after the construction of the A500 bypass, while Desborough in Northamptonshire experienced a 25% increase with the A6 bypass.
‘Clearly, properties closest to main thoroughfares will benefit most from a bypass, but this research shows that a bypass can lift the appeal of a town or village as whole,’ said Lucian Cook, director of Savills research who conducted the research.