He then multiplies those costs many times to give big numbers over 10 years and adds in a few high notional costs (like valuing your non-work time using your gross salary rate - a method that always means no-one should move a muscle).
I thought the article was interesting, and to answer the charge against 'special pleading' I'm going to run the same calculation for us, although at the previous job (since we have, ironically, secured jobs and house that are nearby which is the thrust of the original post!).
Myself - £170pcm bus+train ticket, or £340pcm to run a car
wife - £126pcm bus + train ticket, or £193pcm to run a car
(Since we'd own one car either way, we should factor in a discount to the car option above. Let's generously discount £85pcm to keep one on the road out of the general household budget - a grand a year).
Over a ten year period, then, the cost of commuting by public transport would be £35520. The cost of commuting by cars would be £51960.
It's obvious that some allowance must be made for the value of leisure time, since otherwise a calculation would prove that a 10 hour, £50pcm commute was better value than a 1 hour £100pcm commute, although I'd never accept this in reality.
In the original article, the median wage was used, but I'll be pessimistic and use the minimum wage instead. 1h each way plus 45m each way makes 3.5h per day, x £6 = £21, or £462pcm. Over ten years this is £55k.
To be honest, I wouldn't give up extra hours of my already short leisure time just to earn £6, so this is a stiff underestimate, but I suppose that makes the argument more convincing if anything.
So, for us, if we bought a house for a ten year period, logically we should be willing to spend an extra £90k to live near work as opposed to commuting- closer to £110k if we wanted to drive.
However, according to ESPC a four bed in Dunfermline would cost "£200,000 compared to over £370,000" in Edinburgh. This means it would make economic sense to live in Dunfermline and suck up the commuting - although for a two bed flat they say "around £75000 compared to almost £130000", so the sensible decision would be to live in Edinburgh and suck up the extra cost of accommodation.
It's an interesting thought experiment for sure.
Of course, long distance bike commuters can have the best of both worlds, commuting virtually for free, enjoying better health, enjoying their commute time as recreation (if the route is conducive to that, careful choice of house & job required!), etc. etc...
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