Gautrain boosts property
Homeowners in Johannesburg, who have faced disruption, noise and chaotic traffic over the past few years with the construction of the Gautrain high speed rail link, are set to benefit from increased property valuations when the first phase of the rail network opens later this month.
According to Jonny Novick, MD of Vered Estates, anyone who owns property that is situated close to a station on the Gautrain network should see a continued appreciation in the value of their house. "Homes located close to the Gautrain have already increased in value as a result of their proximity to future stations, but there is definitely further value to be had. We are also likely to see a ripple effect, with surrounding areas to the stations benefiting from an increase in value."
Novick says that while the full impact of the Gautrain is as yet an unknown, he expects that having a high speed rail network on your doorstep will be seen as a luxury that people are willing to pay a premium for. "Evidence around the world has shown that property located near rail stations appreciates sharply in value."
Properties situated near the Underground in London, Metro in Paris and Subway in New York all command a price premium, often up to 20 percent. An Australian study by PRDnationwide also found that the price of property located near train networks in the country outstripped other areas by 2.6 percent in 2009.
"While the Northern suburbs of Johannesburg such as Rosebank and Sandton are already priced at a premium in Johannesburg, we do expect areas such as Midrand to see upward price shifts as the lines become operational and commuters start to see the impact on the quality of life that this transportation offers.
"In recent years traffic has become unbearable in parts of Johannesburg and it is not uncommon for a motorist to sit in their car upwards of two hours a day just to get to and home from work.
"At the moment there is some debate as to who will actually use the Gautrain and how safe it will be for commuters. However, once people begin using it regularly and realise that they can cut their travelling times significantly, we expect it to become the norm for many daily commuters in Johannesburg."
The first phase of the Gautrain will initially see trains running between OR Tambo Airport and Sandton, though tracks have also been laid in a number of other areas with services set to run from Hatfield and Centurion through to Midrand, Rosebank and Park Station.
"There is a genuine sense of anticipation surrounding the launch of the Gautrain, not just for the benefits it will bring to those living in Johannesburg, but also as a means of highlighting the city as a true world-class destination. This is likely to have a further positive impact on property prices in the city over the mid to long term.
Novick says the demographics of the greater Johannesburg area are changing significantly with people opting for more affordable smaller properties. This will translate into further higher density developments and the need for good, clean, secure and usable parks. "A good, efficient high speed public transport tool such as the Gautrain is a necessary component of these changing demographics."
Article by: www.iafrica.com