Commuting pays off for home-buyers

Commuters working in London
could save an average of £515 per month on mortgage repayments every five miles
further they move towards Bedford from St. Pancras, according to a new report from
property search engine Gartoo.co.uk . Moving from Camden to
Potters Bar - an added journey time of just 17 minutes a day - could save
£1,234 per month in mortgage repayments, including travel costs.

It’s a similar story in some
of the UK’s other large cities, with commuters in Birmingham and Edinburgh able
to save up to £114 and £152 respectively per month on mortgage costs for
each two miles they live further from the city centre.

The Gartoo.co.uk research was based on average
mortgage repayment rates for three-bedroom homes, calculated on a 5% interest
rate over 25 years. Average house prices and travel distances were sampled from
the centres of 25 cities and from 60 towns and suburbs surrounding Birmingham
and Edinburgh.

Gartoo analysed patterns in commuting
distances and house prices, and believes there are a number of good value areas
for house-hunters to invest in this year.

“Balancing house prices with
the time and cost of commuting is for many, a major financial decision,” said Ruben
Martinez, Gartoo.co.uk.  “But even with houses in short supply, buyers can
now be more ambitious in targeting areas that, in commuting terms, are becoming
good value.

“The total commuting effort,
combining time and travel costs, is infrastructure-dependent and improved
future transport links to will change the equation of house prices and
commuting cost and time. Detecting those areas early on can provide wise
investment opportunities.”

Richmond was found to be the
worst value area near London in terms of commuting times and house prices, as
the average three-bedroom house price is £703,000 and the journey into Central
London takes 53 minutes.  Stratford was
found to be the best value area for commuters into the city with the average
three-bedroom house price at £262,000 and the journey into Central London just
16 minutes.

Outside of London there’s a
strong pattern too of potential savings on the cost of buying a home further
from the city centre. House prices in Bedford, a 43-minute train journey into
St. Pancras, currently average £186,000. In South East England three-bedroom
homes in Canterbury, an 80-minute journey into London, start at around
£150,000.

In major UK cities such as Birmingham
and Edinburgh, moving just two miles out of the city centre can reduce mortgage
costs considerably. In Birmingham, average house prices decrease once four
miles out of the city centre in most directions. The cheapest properties found
were south of Birmingham in Netherton (£119,000 for a three-bedroom house). For
every two miles further from Birmingham city centre and closer to Netherton
house-hunters look, an average of £114 per month can be saved on mortgage
repayments.

In Edinburgh, homeowners can
save on average £152 per month on mortgage repayments for every two miles away from
the city centre and towards Newbridge they live. The suburb of Newbridge, eight
miles west of Edinburgh, was the cheapest location found within 10 miles of the
city, where three-bedroom houses average £125,000.

New rail lines between
London, Oxford and Birmingham, are also set to impact housing decisions for
commuters over the next few years.

Ruben Martinez adds: “Delays
in public transport and stress from traffic can add to the costs of commuting.
However, commuting can help relieve pressures on housing supply, education and
essential services in London and other cities. As planned improvements to
infrastructure are made, suburban homes in well-connected areas remain a sound
investment.”

Aiming to banish irrelevant
search results, Gartoo.co.uk is a search site experimenting with specialised
search technology which focuses on UK property keywords entered by the
house-hunter to find the most accurate fit.

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