What value does proximity to a train station add to a home?

What value does proximity to a train station add to a home?

June 28, 2023 | by DiJones

The features buyers look for in a property are wide and varied, but proximity to a train station tops the list for many house hunters on the Upper North Shore.

We find out why homes near train stations are so popular, who wants to buy them, and how much being within walking distance of a train station can add to a property’s value.

The North Shore line and property prices

The North Shore train line has influenced Upper North Shore real estate prices since it was first mooted in the late 1800s. Land subdivisions for residential development began in suburbs like Pymble in the early 1880s, anticipating the hoped-for new railway line. When the train line from St Leonards to Hornsby finally opened in 1890, it was the catalyst for population growth, residential development, and rising real estate prices. Suburbs from Roseville to Lindfield, Gordon, and Hornsby saw land values soar as Upper North Shore real estate was snapped up by businessmen and their families drawn in by the fresh air, healthy lifestyle, and – crucially – easy rail access to the city.

What are the benefits of a property near a train station?

More than 130 years after the North Shore Line first opened, it continues to buoy local real estate prices. It is a basic rule of land economics that access to transport increases land value. While this principle holds for all types of transport, including road links and other public transport such as buses, the effect is particularly marked for train stations. Suburbs with a train station tend to enjoy better liveability and more employment opportunities.

It’s easy to understand why, in 2023, proximity to a train station is valuable. Our population is increasing, our city is expanding, our roads are more congested, and the cost of parking and fuel is rising. Time is a more valuable commodity than ever before, and no one wants to spend it sitting in traffic. We’re also more environmentally conscious now. Catching the train can help relieve all these issues, so it’s no wonder proximity to a train station is a key factor for many property purchasers in today’s market.

Are homes near train stations worth more?

While we know anecdotally that buyers want to purchase property near a train station, there is data to confirm that proximity to a train station can increase a home’s value.

A NSW government-backed study carried out in Sydney between 2000 and 2014 shows that properties within 400 metres of a train station experienced a 4.5% lift in value. The report, conducted by LUTI Consulting and Mecone Planning, also found that properties 400 to 800 metres from a station saw a 1.3% price rise, while homes 800 to 1600 metres away increased in value by 0.3%.

James McIntosh, director of LUTI Consulting, explains that these property value increases are driven by two factors. One is that people for whom reduced travel time is a priority are willing to pay more for homes within walking distance of a train station. The other is that developers and investors are also prepared to pay more for property close to a station due to its potential. The study found that land close to a station has a greater redevelopment potential as it is more likely to be rezoned or upzoned in the future to allow for increased housing density.

But it’s not just that properties near a train station may sell for a higher price. They may also sell more quickly because they’re in higher demand.

Who’s looking for homes near train stations on the Upper North Shore?

Another reason properties close to train stations might sell for a higher price and in a shorter time is because they attract demand from a wide range of buyers. People looking for a family home, first home buyers, investors, and developers are among the groups seeking properties close to train stations.

While remote working is more prevalent than it was pre-COVID, it’s no longer as widespread as it was in 2020 and 2021. One study found that only 29% of Australian adults worked remotely in 2022, and a recent report reveals that around one-third of Australian company leaders are scaling back on remote and hybrid working in 2023. With the commute back on the cards for many, living near a train station has taken on renewed importance.

A home near a train station is also at the top of the wish list for many families with school-aged children, especially here on the Upper North Shore. Our area is endowed with many world-class private and public schools, and living within walking distance of a train station means children can get to and from school and extra-curricular activities independently.

Investors are also looking for properties close to train stations because renters prize proximity to reliable public transport. Buying an investment home within walking distance of a train station can help investors attract and retain quality tenants, as well as being a good potential source of future capital growth.

If you’re looking to buy, sell, invest, or rent near an Upper North Shore train station, we can help. Get in touch with our expert local team today.

DiJones Real Estate, together with their directors, officers, employees and agents have used their best endeavours to ensure the information passed on in this document is accurate. However, you must make your own enquiries in relation to the information contained in this document and seek advice from your financial advisor, broker or accountant to ascertain its application to your circumstances.
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