Proximity to airports and flight paths does not reduce growth of home values, says don

KUALA LUMPUR (May 1): Proximity to airports and flight paths does not impact the annual capital appreciation of homes, said professor of property economics at Queensland University of Technology (QUT) Chris Eves.

Transaction data and studies show that while prices of these homes may be lower compared with those within socio-economically similar suburbs that are not close to airports or flight paths, their long-term capital appreciation performance was similar, he said at the International Real Estate Research Symposium 2016 (IRERS 2016) on Wednesday.

TheEdgeProperty.com is the media partner for this symposium.

“Based on long-term median annual house price movements, suburbs located under the main southern flight path and subject to minimum 70 decibel aircraft noise in Brisbane have shown average annual capital growth equivalent and in some cases higher than similar housing stock in locations with aircraft noise less than 70 decibels not located under Brisbane airport flight paths,” he noted.

In fact, most of the affected suburbs in the Gold Coast have shown higher average annual capital returns compared with areas hardly affected by aircraft noise, he said.

Eves added that there are other more prominent factors that affect property prices.

“In the Brisbane and Gold Coast residential property markets, the main drivers of residential property value are proximity to transport, the main CBD, schools, recreation facilities, and other services which have a more significant impact on long-term residential property performance than aircraft noise factors,” he concluded.

Eves was presenting his research paper titled “Major infrastructure innovation and the public response: Aircraft noise and residential property markets: Brisbane and Gold Coast airports”.

The first longitudinal study of its kind, Eves conducted the research from 1988 to 2014 in Brisbane and the Gold Coast – specifically 36 suburbs within a 14km radius from Brisbane Airport’s runway, and 18 suburbs in the Gold Coast – by analysing all residential house sales in these areas.

The suburbs were further divided into three types – high noise complaints (HNC), moderate noise complaints (MNC) and no noise complaints (NNC).

In Brisbane, the HNC suburbs were located on the southern flight paths and within 10km from the existing main runway at Brisbane Airport, while the MNC suburbs were located to the south, north, west and east of Brisbane Airport and within a 5km-10km radius. The NNC suburbs included the inner ring, middle and outer ring suburbs.

In the Gold Coast, the HNC suburbs were located on the southern flight path and predominantly in New South Wales, whereas the MNC and NNC suburbs were located to the north and northwest of the airport and were predominantly Gold Coast suburbs.

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This story first appeared in TheEdgeProperty.com pullout on April 29, 2016, which comes with The Edge Financial Daily every Friday. Download TheEdgeProperty.com here for free.