Does the proximity to the new underground station really affect the value of your property? Yes, and significantly so! Find out how infrastructure measures directly impact property value and how you can benefit from them.
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The topic briefly and concisely
Good transport links (road, rail, public transport) can increase the property's value by 10-15%.
Social infrastructure such as schools and doctors nearby can increase the value by an additional 5-10%.
Digital infrastructure, especially fibre optic connections, is becoming increasingly important and can increase value by up to 8%.
The value of a property depends on many factors. One of the most important is the surrounding infrastructure. Good connections to transport links, utilities, and social amenities can significantly increase the infrastructure value of a property. In this article, you will discover which infrastructure elements particularly enhance value, how these are considered in valuations, and the role future developments play. We will show you how you, as an owner or investor, can optimise the use of these factors.
Fundamentals: What Determines the Infrastructure Land Value
The standard land value indicates the average value of a square meter of undeveloped land. It is determined at least every two years by expert committees. The infrastructure, such as transport links and utilities, significantly influences this value. A good location can increase the standard land value by 20% or more. A well-founded property valuation is therefore essential. These factors are crucial for the current and future infrastructure property value.
Transport connections as value drivers: roads, railways and public transport
Good transport links are worth their weight in gold for the infrastructure property value. Proximity to motorways or major roads can increase the value by 10-15%. A well-developed public transport system is also an advantage. Studies show that property values in direct vicinity of underground stations are on average up to 15% higher. Even a good bus connection can raise the value by 5-10%. Pay close attention to these aspects when conducting the property analysis for your construction project. The accessibility of workplaces and leisure facilities is playing an increasingly important role.
Social infrastructure: schools, nurseries and healthcare services
Not only traffic routes but also social infrastructure significantly influence the infrastructure property value. The availability of kindergartens and schools is a knockout criterion for families. A school within walking distance can increase the value by 5%. Doctors and pharmacies nearby enhance attractiveness and value by another 3-5%. Shopping facilities for daily needs are also important. Good local supply can positively influence the property value by up to 7%. These aspects are part of a comprehensive infrastructure assessment.
The following social infrastructure facilities are particularly relevant:
Educational institutions (daycare centres, schools of all levels, universities) – can increase value by 5-10%.
Medical care (doctor’s surgeries, pharmacies, hospitals) – up to 5% increase in value.
Shopping facilities (supermarkets, specialist shops, weekly markets) – up to 7% boost.
Leisure and cultural facilities (parks, sports centres, theatres) – can increase value by 3-6%.
Security facilities (police stations, fire stations) – indirect positive influence.
A comprehensive analysis of these factors is essential for a realistic assessment.
Technical Infrastructure: Security of Supply and Digital Connectivity
The technical infrastructure is an often underestimated factor for the property's land value. A reliable supply of electricity, water, and gas is a basic requirement. The costs for the initial development of a property can quickly amount to 15,000 to 30,000 euros. Digital infrastructure is becoming increasingly important. A fibre-optic connection can increase the value of a property by up to 8% today. The availability of fast internet is a must for many buyers. Consider the future security of your investment.
Regional Differences: Where Infrastructure Strongly Influences Property Value
The impact of infrastructure on property value varies significantly by region. In cities like Munich (average €2,900/m²) or Hamburg (€950/m²), top-notch infrastructure is already factored into the price. Here, even small improvements, such as a new tram line, can boost the value by 5-10%. In rural areas with moderate prices, for example, under €100/m² in parts of Saxony, the expansion of infrastructure can lead to higher percentage increases in value. A new bypass road can increase the value by 15% here. Therefore, a thorough analysis of infrastructure projects is important. The value of infrastructure to property is dynamic.
Examples of price differences (building land per m²):
Munich: approx. €2,900
Stuttgart: approx. €1,685
Frankfurt: approx. €1,500
Berlin: approx. €590 (although source cites €769 for 2023, the lower value from the table for towns >100k inhabitants is used here)
Rural areas Saxony/Thuringia: < €100
Saxony-Anhalt: approx. €66
These figures highlight the vast range and the importance of local factors.
Future Perspectives: Sustainability and Smart City Concepts
Future developments in the field of sustainable infrastructure and smart city concepts will continue to influence the value of infrastructure properties. Charging stations for electric vehicles nearby can already increase the value by 1-2%. Energy-efficient district heating networks or the expansion of cycle paths enhance the attractiveness and can raise the value by 3-5%. Projects focusing on urban infrastructure and quality of life are on the rise. Investments in green technologies and intelligent networking pay off in the long run. Keep a close eye on these trends.
infrastructure-property-value
Infrastructure can also have a depreciating effect. Noise from nearby motorways or flight paths can reduce property value by 10-20%. Contaminated land, for example from former industrial use, can incur remediation costs of over €50,000 and correspondingly decrease the value. Lengthy planning procedures for infrastructure projects with unclear impacts also create uncertainty. A careful assessment of these risks is essential before any purchase or sale. Therefore, the infrastructure property value has two sides.
Potential devaluing factors include:
Noise pollution (traffic, industry): up to 20% reduction.
Poor air quality: can reduce value by 5-10%.
Flood risk: significant reductions depending on the risk.
Contaminated land: remediation costs of >€50,000 possible.
Building regulations: can restrict use and value.
Missing or outdated infrastructure: reductions of 10-25% possible.
A thorough examination protects against unpleasant surprises.
Recommendations: How to use infrastructure for your property value
What is meant by the infrastructure land value?
The infrastructure land value refers to the part of the overall land value that is directly or indirectly determined by the quality and availability of the surrounding infrastructure (transport, utilities, social facilities, digital connectivity).
How much can good infrastructure increase land value?
Excellent infrastructure can increase land value by 20-30% compared to poorly connected plots, or even more in some cases. For example, good transport links alone can raise the value by 10-15%.
What role does the standard land value play in connection with infrastructure?
The standard land value is an average value determined by appraisers, which also considers the existing infrastructure of an area. However, individual infrastructure characteristics of a specific plot can lead to deviations from the standard land value.
Are development costs part of the infrastructure land value?
Yes, development (connection to roads, sewerage, electricity, etc.) is a fundamental part of the infrastructure. An undeveloped plot has a significantly lower value. Development costs can amount to 15,000 to 30,000 euros or more.
How can Auctoa help me determine the infrastructure land value?
Auctoa utilises AI-driven analysis and comprehensive market data to objectively and accurately assess the impact of specific infrastructure on your land value. Request a free appraisal or chat with our ImmoGPT.
Does proximity to an airport always negatively affect land value?
Not necessarily. While aircraft noise can reduce value by up to 20%, good accessibility to an airport can also be a positive factor for business travellers or logistics companies. It depends on the exact location and type of use.
Additional useful links
Statistisches Bundesamt provides comprehensive data on construction prices and the property price index in Germany.
Federal Institute for Research on Building, Urban Affairs and Spatial Development (BBSR) offers a publication on research in the fields of construction, urban development, and spatial planning.
Federal Institute for Research on Building, Urban Affairs and Spatial Development (BBSR) provides a detailed publication on residential and commercial properties in Germany.
Gigabit Office of the Federal Government publishes an article about a real estate study examining the impact of fibre optic technology on the property market.
PwC provides a study on investing in educational institutions in Germany.
Future Institute offers a study on real estate in 2040 and the future urban economy.
FAQ
What is meant by the infrastructure land value?
The infrastructure land value refers to the portion of the total land value that is determined directly or indirectly by the quality and availability of the surrounding infrastructure (transport, utilities, social facilities, digital connectivity).
How significantly can good infrastructure increase property value?
A very good infrastructure can increase the property value by 20-30% or even more in some cases, compared to a poorly connected property. For example, good transport links alone can raise the value by 10-15%.
What role does the standard land value play in relation to infrastructure?
The standard land value is an average value determined by expert committees, which also takes into account the existing infrastructure of an area. However, specific infrastructure characteristics of a particular property may lead to deviations from the standard land value.
Are development costs part of the infrastructure land value?
Yes, the development (connection to roads, sewers, electricity, etc.) is a fundamental part of the infrastructure. A plot of land without development has a significantly lower value. Development costs can amount to 15,000 to 30,000 euros or more.
How can Auctoa help me determine the land value for infrastructure?
Auctoa uses AI-powered analyses and comprehensive market data to objectively and precisely assess the impact of specific infrastructure on your property's value. Request a free valuation or chat with our ImmoGPT.
Does proximity to an airport always negatively impact property value?
Not necessarily. While aircraft noise can reduce value (by up to 20%), the good accessibility of an airport for business travellers or logistics companies can also be a positive factor. It depends on the exact location and the type of use.
