What are the factors that give a place value?

Little Green Street, Kentish Town, London: probably quite valuable. Image: Getty.

The value of place is simultaneously the most discussed and the least understood of all things. House prices used to be the leitmotiv of a million clichéd dinner parties – no more, I think – but what we mean by the value of an actual neighbourhood and what drives that value is not only little discussed. It has, until recently, barely even been studied.

Create Street’s new report, Beyond Location, tries to answer this question. We have taken advantage of new techniques for analysing values as well as the big data revolution. We have conducted a uniquely wide, data-rich analysis of every 2016 property sale in six English cities (London, Birmingham, Manchester, Leeds, Liverpool and Newcastle).

This has used open datasets to compute basic urban characteristics, such as street network connectivity, population density, amount of greenery, availability of different transport modes. The point of the analysis was not to investigate them separately, but together – and to permit city-wide conclusions and inter-city comparisons.

The findings – part predictable, part surprising – tell us much about the state of our cities. One thing they do show is that urban form really does matter in understanding value. Our models for urban form can predict up to 74 per cent of the official UK poverty index – the Index of Multiple Deprivation – and up to 54 per cent of sales values.

How do specific characteristics affect the value of a London property?

Our key findings include that more greenery is not always a good thing. The immediate presence of attractive greenery or high-quality parks can add huge value in many situations. However, at the city-wide level, the presence of more greenery can be associated with lower as well as higher value. What it is and how it is managed really matters. For example, in London, a home closer than average to a high-quality park costs, on average, 11 per cent (or £51,000) more than one that is not, holding everything else equal. However, in Liverpool, a home located closer than average to a high-quality park is worth, on average, 7 per cent (or £7,760) less. 

Land use and form also matters. We found significant relationships across the six cities between urban form and deprivation and value. Areas of high population and high areas of unbuilt land – for example, high-rise estates with lots of wide-open space – are less valuable and often associated with more deprived communities. This might be partly due to the history of post-war building but, after thirty years of right to buy, most people who can afford to choose continue to avoid this type of urban pattern

Population density and deprivation in London. Click to expand.

The heritage premium is more important than the new build premium. In every city studied, proximity to a listed building was associated with more additional value than the premium associated with a newly built home. A home closer than average to a listed building in London is worth 10.3 per cent (or £49,770) more than one that isn’t, holding everything else equal. The equivalent new build premium is only £8,795.

The findings also highlight a clear difference between London and the other British cities. Accessible income is driving an urban renaissance in London out of all proportion to that visible elsewhere in the UK. Walkable street-based networks or older properties have a value premium over other neighbourhoods which far exceeds that yet visible in other cities. Proximity to a listed building is associated with nearly seven times as much value premium in London as in the other cities studied.

Finally, diversity is valuable. Areas with more diversity of house types suffer from less deprivation. Areas with a more diverse offering of transport and amenities are normally worth more, other things being equal. Above average amenity diversity is associated with additional value in all cities studied.

Property value and connectivity in Newcastle. Click to expand.

Value is a fraught term. Extra value is not always a good thing – certainly not for everyone. In globally successful cities, spiralling house prices are forcing out existing communities. There are ‘sorting effects’, where the better off out-compete the less well-off for the best places.


The ultimate aim of this study therefore is to help developers to build and planners to permit more good places by understanding human preferences more richly.

One thing is for certain though. When it comes to understanding, and predicting, economic and social value, urban form and design really matters.

Alessandro Venerandi is a researcher and urban designer at Create Streets. He has recently completed his doctorate in urban sustainability and resilience at UCL. Beyond Location is available here.

 
 
 
 

As EU funding is lost, “levelling up” needs investment, not just rhetoric

Oh, well. Image: Getty.

Regional inequality was the foundation of Boris Johnson’s election victory and has since become one of the main focuses of his government. However, the enthusiasm of ministers championing the “levelling up” agenda rings hollow when compared with their inertia in preparing a UK replacement for European structural funding. 

Local government, already bearing the brunt of severe funding cuts, relies on European funding to support projects that boost growth in struggling local economies and help people build skills and find secure work. Now that the UK has withdrawn its EU membership, councils’ concerns over how EU funds will be replaced from 2021 are becoming more pronounced.

Johnson’s government has committed to create a domestic structural funding programme, the UK Shared Prosperity Fund (UKSPF), to replace the European Structural and Investment Fund (ESIF). However, other than pledging that UKSPF will “reduce inequalities between communities”, it has offered few details on how funds will be allocated. A public consultation on UKSPF promised by May’s government in 2018 has yet to materialise.

The government’s continued silence on UKSPF is generating a growing sense of unease among councils, especially after the failure of successive governments to prioritise investment in regional development. Indeed, inequalities within the UK have been allowed to grow so much that the UK’s poorest region by EU standards (West Wales & the Valleys) has a GDP of 68 per cent of the average EU GDP, while the UK’s richest region (Inner London) has a GDP of 614 per cent of the EU average – an intra-national disparity that is unique in Europe. If the UK had remained a member of the EU, its number of ‘less developed’ regions in need of most structural funding support would have increased from two to five in 2021-27: South Yorkshire, Tees Valley & Durham and Lincolnshire joining Cornwall & Isles of Scilly and West Wales & the Valley. Ministers have not given guarantees that any region, whether ‘less developed’ or otherwise, will obtain the same amount of funding under UKSPF to which they would have been entitled under ESIF.


The government is reportedly contemplating changing the Treasury’s fiscal rules so public spending favours programmes that reduce regional inequalities as well as provide value for money, but this alone will not rebalance the economy. A shared prosperity fund like UKSPF has the potential to be the master key that unlocks inclusive growth throughout the country, particularly if it involves less bureaucracy than ESIF and aligns funding more effectively with the priorities of local people. 

In NLGN’s Community Commissioning report, we recommended that this funding should be devolved to communities directly to decide local priorities for the investment. By enabling community ownership of design and administration, the UK government would create an innovative domestic structural funding scheme that promotes inclusion in its process as well as its outcomes.

NLGN’s latest report, Cultivating Local Inclusive Growth: In Practice, highlights the range of policy levers and resources that councils can use to promote inclusive growth in their area. It demonstrates that, through collaboration with communities and cross-sector partners, councils are already doing sterling work to enhance economic and social inclusion. Their efforts could be further enhanced with a fund that learns lessons from ESIF’s successes and flaws: a UKSPF that is easier to access, designed and delivered by local communities, properly funded, and specifically targeted at promoting social and economic inclusion in regions that need it most. “Getting Brexit done” was meant to free up the government’s time to focus once more on pressing domestic priorities. “Getting inclusive growth done” should be at the top of any new to-do list.

Charlotte Morgan is senior researcher at the New Local Government Network.