What Heathrow decision could mean for London property

What Heathrow decision could mean for London property (Heathrow airport website)

The issue of the possible expansion of Heathrow Airport has been one of the longest-running sagas in British politics. In 2010, it was proposed by the Labour government under Gordon Brown, but opposed by the Conservatives and Liberal Democrats. With the latter two forming a coalition government, it appeared the issue would be off the table for some time.

However, it was soon back. With Heathrow running at 99 per cent capacity and concerns that the capital's other airports were not adding enough extra room, many advocates in politics and business started to push for expansion to take place after all. 

Bound by the coalition agreement, the government would not legislate for this in the 2010-15 parliament, but instead set up the Davies Commission, which reported after the 2015 election with a verdict in favour of Heathrow. 

The government eventually confirmed its support for the decision, despite the opposition of big beasts like Boris Johnson, who advocated his own idea of a giant hub airport in the Thames Estuary. Matters have now come to a head with parliament voting 415-119 in favour of the expansion.

So much for the politics: barring legal challenges, the £14 billion expansion of Heathrow is all but a done deal. The question now is how this might impact the London property scene. 

The answer is that there is likely to be a mixture of effects. The obvious negative will be on property prices near the airport, and under the flight path. Although the plans will include some noise mitigation measures, the reality is that living near the airport will be a lot noisier and this - along with increased pollution and congestion - is likely to have a deleterious effect on property prices. For some, the outcome will be the loss of their homes. 

Indeed, it is no surprise that some of the most prominent critics include MPs in the area, including shadow chancellor John McDonnell, whose Hayes and Harlington constituency contains Heathrow. Boris Johnson's Uxbridge and South Ruislip seat is next door. 

Mr McDonnell spoke in the Commons about how villages that had stood for 1,000 years would now be destroyed. Mr Johnson was conveniently out of the country, but Greg Hands, MP for Chelsea and Fulham, resigned his ministerial post days earlier to vote against Heathrow.

However, there is a good chance that the wider benefits to London's property market will be substantial. The fact that Heathrow is operating so close to capacity means new destinations are not being opened up. Emerging megacities in the far east have no direct connection. With an extra runway, this is a significant opportunity to build new links around the globe, a key priority as Britain's trading relationships drift away from Europe.

This may be invaluable at a time when the London property market has stalled somewhat, thanks largely to the uncertainty about its future role as a global centre of trade and finance. The government and organisations like the Confederation of British Industry (CBI) have trumpeted the Commons vote as a clear sign that Britain is open for business. Indeed, the CBI hailed the verdict as "a truly historic decision that will open the doors to a new era in the UK's global trading relationships".

Of course, the development of Heathrow is not all about London. While new international routes may be important, so too will be the planned increase in domestic flights, helping spread the benefits beyond London and the Home Counties. 

The expansion of Heathrow may still be some way off, with a number of pressure groups and environmental bodies planning to drag the matter through the courts for as long as possible. But assuming the plan clears these hurdles, the 2020s could bring some significant new property boosts across London and the country at large.