Londoners are prepared to pay a £20,000 premium for property that is 500m from the nearest tube station compared with a similar property 1,500m from station, according to the Nationwide Building Society.
Research by the nationwide showed that the impact on prices is greatest close to stations with the average house prices highest around the Circle line
Using the Nationwide House Price model, the building society assessed how property prices in the Greater London region vary in relation to the distance to the nearest tube or train station.
In order to produce a more accurate picture of the impact of the proximity of public transport has on the prices of property, the research isolated the specific impact this has over and above other property characteristics, such as property type, size and local neighbourhood type.
The Society’s figures suggest that a property located 500m from a station would attract a seven per cent price premium (approximately £20,300) over an otherwise identical property 1,500m from a station.
Nationwide’s research acknowledged that access to rail transport is generally very good within Greater London, with 93 per cent of properties located within 1,500m of a station.
Whilst the tube is perhaps the best-known aspect of London’s transport infrastructure, the National Rail lines also form a vital part of the network, with 70 per cent of properties closest station being National Rail operated.
In the inner zones however, the tube is more dominant, as you might expect given the geography of the network.
"London has an extensive network of underground and surface rail lines which form an important part of the city's infrastructure,” said Martin Gahbauer, Nationwide's Chief Economist.
“Thirty four per cent of Londoners usually use either National Rail or London Underground services to travel to work, compared to eight per cent for Great Britain.
“Therefore, one might expect those buying property in the capital would prefer to live close to a tube or train station and be willing to pay a premium for this.
"The research showed that the increase in price premium for identical properties as those properties got progressively closer to a station. The value-added is measured relative to a property 1,500m from the nearest station. An identical property located 250m closer [so 1,250m from station] commands a 1.6 per cent premium.
“Premiums increase as you move closer towards a station. For example, an identical property located 1,000m from a station would command a 3.4 per cent premium, whilst at 750m this increases to 5.2 per cent."
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