Abolition of bridge tolls could send property prices sky-high
The abolition of Severn Bridge tolls will create an economic and property boom in south Wales but could price local people out of affordable housing, a property expert has warned.
According to the Wales Office, the removal of charges in late 2018 could boost the local economy by some £100m a year.
But according to Vicky Kells of Clarke Willmott, scrapping the tolls could lead to a surge of people moving into south-east Wales from the Greater Bristol area, sending both property and land prices soaring.
The result could see local residents being priced out of the housing market, allowing private providers to thrive at the expense of desperately needed affordable and social housing developers, who will find it difficult to compete when it comes to offering premium prices.
Ms Kells says careful consideration will be needed so that all housing needs for the area are catered for.
She said: “Whilst the scrapping of the tolls should be welcomed, there is a danger of a gold rush-style influx of businesses and residents wanting to locate in the area, causing land and house prices to soar.
“There are already reports which suggest 80% of house-buyers in south Monmouthshire are from Bristol because property prices are so much cheaper than over the water.
“Add to that free prescriptions and university fees, and south Wales suddenly becomes a more attractive and affordable option, with people happy to drive the short commute to Bristol.
“Fuel costs and bridge fees negated the financial benefits but removing the tolls suddenly makes the area from Chepstow to Junction 24 of the M4 and up to Monmouth an extremely attractive and much more viable choice.”
Ms Kells said a sensible approach is needed as not everyone stands to benefit from the tolls being abolished.
There have already been recent reports of the “Bristol effect”, with local people being unable to buy properties in the area as they are being snapped up by higher earners from the West Country capital.
She is also concerned at the impact a surge in property demand could have on the provision of affordable and social housing.
She said: “South Wales is already suffering from a chronic shortage of affordable and social housing which could potentially worsen with the expected surge in demand for more private developments.
“Landowners might be in line for a windfall by selling to developers but serious consideration needs to be given for local residents not in a position to buy on the open market as well as the local infrastructure.”
A Welsh Government report estimating a potential 12% increase in traffic volumes, equivalent to around 11,000 vehicles a day on the M4, is another reason why land to the east of the Brynglas tunnels will be eyed with an increasing amount of interest, as people will not want to run the gauntlet of one of Wales’ worst bottlenecks.
Ms Kells added: “There is no doubt that the removal of the tolls will create a number of tremendous opportunities and confirm that Wales is very much open for business.
“Rather than get caught up in the initial euphoric rush, a much more considered, strategic approach is needed that has longer-term considerations for south-east Wales’ housing needs.”