Superfast broadband could add a surprising amount to the value of your home

A government scheme that aimed to roll out faster broadband to ‘commercially unviable’ parts of the UK led to a surge in home values of up to £3,500, according to a review published by the UK’s Department for Digital, Culture, Media & Sport.  

The review found the superfast broadband program “led to an increase in house prices (of between £1,700 and £3,500) suggesting that buyers valued the technology.” The price rise was observed between 2012 and 2019. 

“This estimate represents how much house buyers valued access to a superfast broadband connection, accounting for many of the programme’s indirect effects such as enabling greater remote working and reducing commuting times,” the government said.

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Superfast broadband is defined as a minimum of 30 megabits per second. But while those speeds are available to 96% of homes in the UK, only 60% of premises have taken up this level of service, UK communications authority Ofcom reported in December. 

Digital secretary Oliver Dowden said in a statement today that this meant 11 million homes in the UK haven’t upgraded to superfast broadband, despite it being available. 

“96% of us can now access superfast broadband, but 11 million homes are still missing out on faster speeds available in their area,” said Dowden. 

“I encourage anyone fed up with slow loading times or shaky video calls to check with their provider or an online switching service and see if they can join the superfast lane.”

Given the pandemic and the uptick in remote work and remote schooling, households should be looking at superfast broadband even without the increase in a house’s value. 

But if only 60% of households have taken up superfast broadband, what does this mean for the new £5 billion “Gigabit Britain” program that would enable 1,000 Mbps? As Ofcom recently noted, 20% or 4.7 million UK households struggled to pay for telecoms bills.  

Initially, the plan was to bring gigabit speeds to the whole country by 2025, but the goal was recently revised to target 85% coverage by 2025. 

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The £5 billion was the government’s contribution to bringing Gigabit broadband to the 20% of the hardest-to-reach regions. The private sector would fund 80% of Gigabit coverage, while the the government would subsidise the remaining 20%.   

According to Ofcom, Gigabit broadband is currently available to 7.9 million homes in the UK, amounting to about 27% coverage. 

But the pandemic and new applications could mean Gigabit broadband would be in higher demand by the time it is rolled out more widely. Ofcom found that average monthly data used increased by 80% in two years to 429 GB per connection in 2020, up from 241 GB in 2018.