As you might have noticed the long awaited Elizabeth Line (formerly known as Crossrail) opened in London this week. So let’s have a look at the Elizabeth Line and the impact it might have on the London property market.
What exactly is the Elizabeth Line and where does it run?
The Elizabeth Line is a 120km new rail line across London, some of which is in a new bored tunnel and some of which uses existing lines. It links Reading in Berkshire through central London with spurs to Shenfield in Essex and Abbey Wood in the London Borough of Bexley. There is also a spur to Heathrow Airport.
It's forecast the new railway will carry 200 million passengers annually. It will bring an additional 1.5 million people within 45 minutes commuting distance of London’s key business districts like Canary Wharf. It is a fast and frequent service too. Some stations will have a train every 2.5 minutes. Example journey times are Canary Wharf to Liverpool Street in 6 minutes, to Paddington in 16 minutes and to Heathrow Airport in 39 minutes.
The line was originally planned to open in 2018. Even now there won’t actually be a full east-west service until the end of this year. Until then lines will interchange at Paddington.
The full list of Elizabeth Line destinations approximately west-east is: Reading, Twyford, Maidenhead, Taplow, Burnham, Slough, Langley, Iver, West Drayton, Heathrow, Hayes & Harlington, Southall, Hanwell, West Ealing, Ealing Broadway, Acton Main Line, Paddington, Bond Street, Tottenham Court Road, Farringdon, Liverpool Street then Whitechapel, Stratford, Maryland, Forest Gate, Manor Park, Ilford, Seven Kings, Goodmayes, Chadwell Heath, Romford, Gidea Park, Harold Wood, Brentwood and Shenfield on one spur. With Canary Wharf, Custom House, Woolwich and Abbey Wood on another spur.
Next, why might the opening of the Elizabeth Line affect the property market in London?
History has proven that better infrastructure almost always boosts the property market in the areas it serves.
New rail lines and new stations cut travel times between destinations. That particularly applies to commuters. It means commuters are tempted to buy and rent in places they wouldn’t have considered before.
The Elizabeth Line should particularly benefit commuters thanks to faster actual journey times and less need to change trains.
New rail lines also persuade businesses to locate in places they might not have considered before, safe in the knowledge that employees and customers will be able to reach them easily.
The increased demand for property to buy and to rent as a result of both of these can push up prices and rents in the areas around stations.
So is the Elizabeth Line boosting the property market?
It’s not that simple. There are a few issues to consider.
There is less commuting as a result of the impact of Covid. Some people are still working from home at least some of the time. Many businesses need less commercial office space than they used to.
The Elizabeth Line does not serve any places that did not already have good public transport. So the impact is likely to be less than if it was a brand new rail line serving an isolated location.
The places along the line are not all the same. They have totally different property markets. Places like Bond Street, Canary Wharf and Shenfield in Essex have totally different property markets for example.
The Elizabeth Line has been in planning for a long time now. So the benefits have probably already been factored in to prices in some of the areas already. Some buyers and investors have been buying in these areas already knowing that the line would open (eventually).
Interestingly, the fact the Elizabeth Line was being built might have affected prices already but most likely it hasn’t yet affected rents. Tenants tend not to rent in an area with a planned new rail connection until it is actually available to use.
There are some big regeneration and development projects along the line with thousands of new homes. These will increase supply and might temper price and rent increases, or even push them down.
Lastly, lets take in some opinions from some experts as to the impact of the Elizabeth Line on the property market.
* Property portal Rightmove
says that house prices have more than doubled in the past decade around some Elizabeth Line stations – Maryland, Abbey Wood and Stratford. They say that total buyer demand has surged the most in western areas while prices and competition have risen most in eastern locations.
* London estate agents Benham and Reeves
say postcodes with stations due to benefit from the Elizabeth Line (Crossrail) have seen house prices increase by 79% since the project was first announced, carrying a 14% premium versus the wider areas.
It’s important to remember however that property prices in London (and across the country) have been rising to record highs for a couple of years, even without the Elizabeth Line. With the current economy most experts don’t expect them to rise more than a few percentage points each year going forward.