London Overground Line sees £80 billion added to value of homes within walking distance of its stations
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According to new research published by leading estate agents Hamptons International, the introduction and extension of the London Overground line has added an additional 3 per cent, or £18,000, per annum to the price of homes within a 10 minute walk of its 84 stations.  Since Transport for London (TFL) introduced the Overground service in 2007 on average an additional £90,000 has been added to the value of homes close to stations, a total of £80 billion over 5 years.  The average price of a home close to an Overground line now stands at £580,000 compared to the London average of £440,000.

Commenting on the findings, Johnny Morris, head of residential research at Hamptons International said, “The introduction of the London Overground has had a significant effect on the housing markets it serves.  Prices and activity have not only outperformed the local areas within which the stations sit but the wider London housing market too.

“While it is difficult to separate the impact of infrastructure upgrades from wider market forces, analysis shows that the introduction of the Overground may have added as much as £90,000 to the average price of a home within a 10 minute walk of stations.”

Figure 1 – Comparing prices near London Overground Stations

It is not just house prices that have experienced the Overground effect.  Transaction levels of homes located close to the line have also proved resilient.  The research shows how during the downturn in 2008, housing markets close to Overground stations saw transaction levels fall back less and the market recover faster than other areas of the capital.  Today housing sales close to an Overground station are close to 90 per cent off their peak of 2007, compared to 70 per cent across the rest of London.

Morris comments, “The improved services, stations and new links offered by the Overground made many areas, particularly in South and East London more attractive to both home owners and investors.  In adding these stations to the tube map many areas that had been previously overlooked were brought to the forefront of house hunters’ minds.  With more people in search of affordable housing moving out of the centre, the Overground has introduced new demand across its network.”

Unlike Crossrail, much of the line already existed.  London Overground first came into being when TFL took over the Silverlink Metro in North London in 2007.  Initially the service was made up of just four lines running from Richmond to Stratford, Watford to Euston, Clapham to Willesden Junction and Gospel Oak to Barking.  TFL rebranded the lines to London Overground and in a significant move for the nearby housing markets, added them to the tube map. 

Over the next few years, stations and services were improved, new trains were commissioned and a new station built at Imperial Wharf.  In 2010 the line was extended East, and the South section opened in 2012.

The research looked at the relative performance of the areas surrounding each station along the line and identified which had performed particularly well (see figure 2).  Markets in Dalston Kingsland (31 per cent), Brockley (30 per cent) and Hackney Central (29 per cent) have seen some of the strongest price growth over the last 12 months.

Morris again, “The extensions of the lines to the East and South have in particular seen many relatively undervalued areas shift up the capital’s housing rankings.”

Figure 2 – Relative performance of areas close to London Overground stations.

Station

Line

Avg Price

12mHPI

Dalston Kingsland

North London Line

£546,847

31%

Brockley

East London Line

£453,649

30%

Hackney Central

North London Line

£438,545

29%

Walthamstow Queen's Road

Gospel Oak to Barking Line

£316,905

29%

Brondesbury Park

North London Line

£853,941

29%

Forest Hill

East London Line

£393,674

28%

Clapham Junction

South London Line

£651,696

27%

Sydenham

East London Line

£355,897

26%

Highbury & Islington

East London Line

£1,013,900

25%

Battersea Park

South London Line

£604,758

24%

 

Looking ahead, further extensions to the network are planned for 2015.  From next May routes will run between Liverpool Street and Enfield Town, Cheshunt and Chingford.  The Romford to Upminster line is also to join the network.

Morris concludes “The addition of the new lines to the Overground and tube map will undoubtedly have an effect on those local housing markets.  We expect these areas will see sustained high levels of activity, increased investment flowing into the local housing stock and prices growing 3 per cent a year beyond those of the local area.”

For media enquiries please contact:
Alison Blease, Hamptons International Press Office
020 7758 8422 / 07769 677 825/ bleasea@hamptons-int.com

Johnny Morris, Head of Research, Hamptons International
077824 837290 / morrisj@hamptons-int.com

London Overground Facts and Stats
84 Stations 6 lines
125 million passengers last year
Stations in 21 boroughs

Housing markets served
1.3m homes
33% rented
35% owned
30% social rented
11,000 new homes built since 2007

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