A rapid increase in property prices surrounding Sheffield train station is expected to be triggered by what is commonly known as the ‘HS2 effect’, according to experts.
High Speed 2 - or HS2 for short - is a rail network that will, once complete, connect London to Birmingham and continue to Manchester, the East Midlands, Leeds and Sheffield through its Y-shaped route.
It is set to slash journey times between London and the great cities of the Midlands and the North to as low as they’ve ever been, but has also been beset by problems, controversy and strong opposition from residents, politicians and environmental campaigners.
Despite this, the delivery of first trains for infrastructure testing is expected in early 2024, while the first passengers are set to be travelling on HS2 services by late 2026 and the scheme is set to be fully operational by 2033. The recent delays to another major transport infrastructure project, Crossrail 1, however, could cast this forecast into some doubt.
Nevertheless, each city on the route is expected to see an immediate increase in property prices at the mere prospect of HS2’s arrival. According to Oliver Ramsden, managing director at property investment company Aspen Woolf, cities across Yorkshire such as Bradford, Harrogate and York are already beginning to see impressive growth.
“The rise in house prices has already started and will be continuous,” Ramsden said. “Even during construction, prices will continue to rise in anticipation, which is what we call the ‘HS2 effect’.”
He added: “Any negative impact from building works and the running of the train service will be far outweighed by the huge benefits of being near a station.”
HS2 has had something of a troubled history since initially being announced in 2009 by the then Labour government. It was a further four years, at the beginning of 2013, until the Coalition government confirmed the route. And it wasn’t until the beginning of 2017 when Royal Assent for the scheme was finally granted by Parliament and midway through 2017 until the main civils design work could commence.
In July 2017, the government released plans for Phase 2b of the project, revealing that the route from the West Midlands to Leeds would also run through Sheffield via a new spur and existing lines.
Once fully operational, the rail network could reach top speeds of 360kph and will offer commuters an 87-minute connection from London to Sheffield, half an hour less than it currently takes. This would help to make commuting into London each day for work viable for residents of Sheffield.
“We believe the greatest impact on house prices will be seen in the North,” Ramsden continued. “With journey times reduced to the capital, the northern cities suddenly become valid destinations for new businesses and commuters.”
“We are witnessing this already, the northern cities are showing some of the highest forecasted capital growth in the country. London, on the other hand, is starting to slow.”
Sheffield, for example, was recently cited as one of the strongest cities in the UK for house price growth, reaching the top 10 - while London took last spot at the bottom of the list.
“The stations on the HS2 line will attract investment through new commercial and residential developments,” Ramsden concluded. “This will lead to job growth.”
The HS2 project, which has a budget of £56bn, will reportedly deliver a £92bn boost to the UK economy, with economic regeneration and new residential and commercial developments popping up around potential stations on the line.
As mentioned above, though, the scheme has not been without its ardent critics, who point to its cost, damage to the environment and the disruption it will cause for residents living near the line as negative side-effects of the project.
“So far, we haven’t seen any property growth due to HS2,” Katie Bacon, conveyancer at Graysons Solicitors, said. “Instead, we have experienced people being cautious of how the scheme will affect homes close to the train lines.”
“However, people may be interested in living near the affected stations once the rail network is complete and the benefits it can offer residents becomes clear,” she added.
Homeowners affected by HS2 may be entitled to compensation through a variety of government property schemes, with more than 110 properties in South Yorkshire already being bought by HS2.