Topic: High UK property prices makes long term commuting more viable,
|tmkImmo 10/07/2016 04:00PM|
High UK property prices makes long term commuting more viable, research suggests
It might seem like madness, and expensive, to work in London and live in another major UK city with the commuting costs and travelling time alone onerous.
But new research suggest that low cost air travel and lower house prices outside London does make it cheaper to live in another city with good air connections and still work in the capital city even with Mon to Friday accommodation costs taken into account
Out of eight cities with direct flights to London living in seven of them would be cheaper in terms of annual mortgage costs with a weekly commute by plane, according to research from online estate agent eMoov.
The study compared the average house price between the capital and other short haul flight options around the UK with a direct service into London. It then worked out the total cost of a weekly commute, flying on the Monday morning and returning on the Friday evening, plus four nights’ accommodation either at or close by to the relevant airport, when booked six months in advance.
The researchers calculated the average number of working weeks in a year to be 46 and multiplied the cost of weekly travel and accommodation by this figure before working out
the average mortgage cost after deposit and the annual payment for both London and the other locations, subtracting the cost of travel and accommodation from the difference, to show which cities UK home owners would be better of living in and commuting to the capital by plane, rather than buying in London.
The city offering the biggest annual mortgage saving was Glasgow. With an average house price of just £155,195 the annual mortgage saving compared to London is £21,275. The cost of a weekly round trip into London is £52.98 via Ryan Air for an 80 minute flight, with accommodation bringing the total to just £204.98 a week, or £9,429 a year.
The research says it would take 47 years of travelling at this cost before the deficit between the average property price in London and Glasgow was bridged. When removing the travel and accommodation costs from the annual difference in mortgage payments, home owners in Glasgow would still be £11,845 better off a year.
Belfast is the second cheapest option for commuters flying into London. A year’s worth of travel and accommodation would be just over £8,000 and the annual mortgage saving is just short of £20,000 when compared to London, resulting in an annual saving of £11,547 for another 80 minute commute into London.
Manchester has the third biggest saving across all eight of the cities researched. At £162,970 it’s home to the second lowest average house price and a flight to Heathrow is 65 minutes, with travel and accommodation costing £12,334 annually. When subtracted from the annual mortgage saving when compared to a London property, Manchester home owners would save £8,564 a year.
A similar commute from Leeds would result in home owners in the Yorkshire city cashing in on an annual saving of £7,670 on their mortgage, after paying the cost of £12,150 a year for travel and accommodation.
Although at 85 minutes each, the flight times from Newcastle and Edinburgh are longer but home owners opting to pay the lower price for a property and commute to the capital by plane could save over £7,000 a year on the cost of their mortgage in both cities.
The only one of the eight cities outside of London where home owners would be worse off by commuting in by plane is Exeter. With an Average house price of £259,221 the cost of a mortgage after deposit in Exeter is £233,298 and, when compared to London, the annual mortgage saving is £16,234.
However, the return flight from Exeter to London City Airport is the second most expensive of the eight cities at £115 and the cost of staying around London City Airport is also the most expensive of the lot at £320 a week. As a result, the total cost hits £20,055 a year, cancelling out the mortgage saving and making home owners in Exeter £3,820 worse off.
‘With London property prices continuing to push aspirational buyers further and further out of the capital, there’s no telling where we might be in 10 years’ time in terms of the commute people will consider if prices continue to climb from the inside out,’ said Russell Quirk, chief executive officer of eMoov.
‘The increasing improvement of transport infrastructure across the nation has made commuting larger distances more manageable. We’re not saying commuting by plane is an option for everyone and there are other time requirements to consider in terms of checking in on time. However, as with all new commutes you soon adapt and if it was a choice between 80 minutes stuck on the Central line at rush hour, five hours on a train from Cornwall, or an hour or so in the air, I know which one I would pick,’ he explained.
‘When you also consider that you could live in Glasgow or Manchester, where the cost of living and buying is dramatically lower, but still earn a London wage it seems even more attractive. Couple this with the fact that many companies may even foot the travel or accommodation costs and the savings continue to rise,’ he added.
Quirk also pointed out that more and more people are working remotely at least part of the week so technology can add to the attractiveness of buying a home hundreds of miles from a London office base.