How will the scrapping of the Severn tolls affect the South Wales property market?
It’s been a busy year. Freak weather, nuclear stand-off (and make-up) on the Korean peninsular, the endless Brexit back-and-forth – amidst all the noise you might be forgiven for letting one local, but important, story slip off your radar – the scrapping of the Severn tolls.
Originally, the charges – which have been in place since the first bridge opened in 1966, and currently cost £5.60 for cars – were due to be abolished on 31 December. But under pressure from the Welsh Government, the Department for Transport has confirmed that they will now be done away with on 17 December.
The move has been welcomed by motorists and the Welsh Government alike. Approximately 25 million journeys are made across both bridges yearly, and daily users could end up saving about £1,400 a year once the tolls are removed. And while the Welsh Government makes up to £10m a month from the charges, it has been estimated that the South Wales economy could benefit from their scrapping to the tune of £100m a year.
While there are concerns that lifting the tolls will increase congestion, Welsh Secretary Alun Cairns praised the change. He told BBC Radio Wales: “The principle of paying to come into Wales has irritated us for 50 years.” He went on to argue that making the bridges toll-free will strengthen the ‘Western Powerhouse’ of economic links between South West England and South Wales.
But though the ‘Western Powerhouse’ will undoubtedly benefit businesses, what effect will it have on the South Wales property market?
The situation is complex. Bristol’s house prices are amongst the fastest growing in the UK; according to a survey by Hometrack, Bristol’s prices grew by 3.2% since August 2018. And among the UK cities with the fastest growth, the average price of a house in Bristol at £285,000 is the second most expensive, behind only Oxford at £423,000.
This boom has, of course, given an exceptional boost to Bristol’s economy. A report by the Centre for Cities, a thinktank, found that in March 2018, Bristol had the sixth-fastest growing regional economy, behind Manchester but way in front of London which was placed 20th. Jobs in Bristol’s city centre also grew by 41% in the period between 1998–2015.
But with the lifting of the Severn Bridges tolls, there’s been no better time to start looking over the bridge to relocate. Towns like Chepstow, Newport and Cardiff are within (relatively) convenient commuting distance to Bristol, and with house prices significantly lower over the channel, no wonder first-time buyers and second-steppers are taking seriously the prospect of putting down roots in South Wales. The average house price in Monmouthshire is £253,541, for instance, according to Rightmove. And it is £222,799 in Cardiff; £167,311 in Newport. These compare against a sizeable £285,000 in Bristol.
As well as the appeal of the lower house prices and commuting cost, there is plenty to recommend South Wales to the potential homebuyer. Newport, for instance, has excellent access to transport links in the form of its train station and many accessible junctions onto the M4. It is also a thriving town with an excellent selection of shops, restaurants and amenities as well as a storied industrial history.
And South Wales is rightly celebrated for its lush beauty. Its endless carpet of rolling green hills and fecund farmland is a feast for the eyes, and an irrefutable invitation to explore. Tucked-away seaside towns, glorious natural features like the Gower Peninsular and Tenby Bay, and cultural hubs like Cardiff complete the picture.
So what are you waiting for? Time to toll out.
Image credit: Gareth Thompson