Cheaper to commute to Edinburgh than live there, new study shows
THE high price of homes in Edinburgh means it makes sense for people to live outside the city and commute to work – according to research from the Bank of Scotland.
However, people working in Aberdeen or commuting long distances to Glasgow may be better off if they move close to the city rather than paying high prices for rail season tickets.
The annual survey from the Bank of Scotland analyses the economics of a daily commute by comparing average house prices and then taking into account the cost of a travel card.
Because prices in central Edinburgh are comparitively high, commuters may be better off catching the train rather than living close to their place of work, according to the research.
People travelling from places such as Dunblane, Glasgow and Motherwell to work in the capital face a 60-minute train journey with an average annual rail cost of £2,700. However they benefit from lower house prices – on average 37 per cent or £75,000 lower than Edinburgh.
Commuters travelling from outside the capital are also likely to get more for their money because the price of property per square metre is lower – meaning they may be able to afford a larger property.
People living 30 minutes away from Edinburgh – in towns such as Dunbar, Falkirk and Livingston – pay an average of £1,500 a year in rail fares, but benefit from house prices which are on average 34 per cent lower than those in the capital.
By contrast, commuters who live 30 minutes from Glasgow, in towns such as Linlithgow, Stirling and Greenock, pay an average of £1,600 in rail fares – but only benefit by house prices five per cent (on average £6,000) cheaper than in the city.And commuters to Aberdeen will often pay more to live in rural Aberdeenshire than to live in the city. With the average house price in Aberdeen close to £172,000, commuters with a rail journey of around 15 minutes from Stonehaven pay on average a third more (£49,000) at £221,000 and an annual rail cost of £1,150. Thirty minutes away in Inverurie and Montrose, houses are on average 15 per cent more expensive than in the Granite City – while a rail pass costs between £1,300 and £2,700.
Nitesh Patel, housing economist at Bank of Scotland, said: “Distance from work is often the deciding factor for purchasing a home. It is generally true that the further you commute, the larger are the financial savings made in terms of lower house prices. This is the case with towns surrounding Edinburgh and Glasgow, but not Aberdeen.
“A major consideration for commuting to leading cities, such as these, is that the typically higher income that can be earned tends to go much further in surrounding towns.”
Jamie Macnab, from estate agents Savills, said there had been a decrease in people buying a house in order to commute, particularly in Edinburgh.
He said: “Previously, people from Edinburgh would buy in East Lothian because they would not be able to afford the same house in the city.
“However, the soft house prices in the city have meant people are choosing to stay in the city.”
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Saturday 25 May 2013
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