Congestion Charging

Zone homes in value slump

By Isabel Oakeshott

Evening Standard

12 February 2003
Householders who live just outside the congestion charging zone were today warned to brace themselves for a slump in the value of their homes.

A survey by Britain's most respected property analysts has revealed half of London's property experts believe prices along the boundary will plummet after the scheme begins on 17 February.

Research by the Royal Institution of Chartered Surveyors suggests potential housebuyers will shun the area just outside the zone amid fears it will lead to a surge in traffic in areas not normally affected by congestion.

The RICS survey has also dashed hopes that the scheme will increase the value of homes inside the zone. It found house prices were already extremely high in central London and were unlikely to rise further because of the Mayor's scheme.

The findings came after the RICS, the trade body for chartered surveyors, quizzed 25 members who are senior estate agents around central London.

They found there has been no noticeable change in rents and prices in and around the congestion area in the run-up to the scheme.

But half those surveyed said prices near the boundary will fall because of commuters "rat-running" or parking on the edge of the zone.

RICS chief executive Louis Armstrong said: "This survey echoes concerns already raised by us, that while the scheme may succeed in reducing traffic in central London, it may have the reverse effect on the areas bordering the charging zone."

Homeowners inside the zone had hoped the value of their property would soar thanks to the scheme as streets became more free of traffic.

Last year, estate agents predicted that prices inside the zone could rise by up to £40,000 because residents will receive a 90 per cent discount on the £1,200 annual cost of driving in central London. RICS said in today's report that such figures were over-optimistic.

The organisation said it was too early to estimate how much property prices along the boundary will fall. But experts believe many potential buyers will be put off by the prospect of increased pollution and competition for parking spaces around the zone.

The findings will be a bitter blow for house owners near the boundary, who are already angry that they do not qualify for any discount.

Angie Bray, congestion charge spokeswoman for Conservatives on the London Assembly, said: "This is a double whammy for people living just outside the boundary. They don't qualify for the discount and they will have to put up with all the displaced traffic. The last thing they need is a fall in the value of their property."

Key roads on the boundary where house prices could fall include: Tower Bridge Road, Kennington Lane, Edgware Road, Victoria Street, Vauxhall Bridge Road, Marylebone High Street and Tottenham Court Road. Streets in Belgravia which may be affected include those closest to Victoria, such as Eccleston Place, Lower Belgrave Street and Ebury Street. Chartered-surveyor Gary French works in the Belgravia offices of Friend & Falcke, less than 200 metres outside the congestion boundary. "Values in the quieter roads of Belgravia could suffer if they become congestion charging rat runs," he said.

"Motorists driving along the zone boundary between Park Lane and Vauxhall Bridge could try to avoid the charge by coming through Belgravia. This would affect Lower Belgrave Street, where a family house costs in the range of £1.9 million to £2.4 million.

"These streets are already busier, and around 20 per cent cheaper, than the areas connecting them: Chester Square, Eaton Square and Eaton Place. If congestion charging results in increased traffic through these squares, it is bound to hit house prices."

©2003 Associated New Media

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