Houses in conservation areas sell at a premium and show a greater appreciation in value than those in other areas. This is even after adjusting for the effects of the kind of property involved and where it is located.
These are just some of the findings of the first, rigorous, large-scale, analysis of the effects of conservation areas on house prices in England, funded by English Heritage and undertaken by the London School of Economics and Political Science (LSE).
The study shows that properties in conservation areas sell for 23 per cent more on average than other houses. Even when location, the kind of properties involved and other factors affecting house prices are adjusted for a premium of around 9 per cent was still found.
However, this falls by 4 percentage points (or to 5 per cent) in conservation areas that are classified by Local Authorities as being “at risk” which could mean buildings lying derelict, loss of historic details such as sash windows, neglected public spaces and new buildings which threaten the area’s character.
The research involved statistical analysis of more than 1 million property transactions between 1995 and 2010 from the Nationwide building society and data on more than 8,000 English conservation areas . It also found that house prices in conservation areas have grown at a rate that exceeded comparable properties elsewhere by 0.2.
Dr Gabriel Ahlfeldt, an expert in urban economics at LSE, who led the research, said: “This research shows that heritage has economic value. People value living in places with architectural integrity, good design and traditional character and are willing to pay more for it. It shows that preserving the best of the past, which is what conservation areas are meant to do, can be in the interest of the owners.”
Dr Ahlfeldt, from LSE's Department of Geography, and the research team also assessed people’s perceptions of conservation areas and the planning regime and how these relate to house prices.
They found that there was no universally negative attitude towards planning regulations. Indeed, home owners who had applied for permission were more likely to have positive attitudes towards planning controls than those who had not. Taken together with the evidence on house prices, this shows that the extra controls in a conservation area are not generally seen as an unwelcome burden.
Dr Simon Thurley, Chief Executive of English Heritage, said: “Since they were introduced 40 years ago, England’s 9,000 or so conservation areas have been helping to preserve the special character of the nation’s best-loved places. At the heart of historic cities and market towns, in suburban neighbourhoods and rural villages, they form the network of everyday heritage that gives communities their cohesion and makes this country unique.
"Our joint research project with the LSE proves the overwhelming popularity of conservation areas and that caring for them - even in the current financial climate – pays dividends.”
Full details of the research