Two conventional railway lines in Greater Manchester were replaced by a new light rail system. This paper uses hedonic price methodology to examine whether any of the claimed benefits were capitalised in house prices. No discernible effect was found. This finding contrasts with claims made for the urban transit schemes in other countries. Reasons for the differences and methodological problems with the current literature are discussed.

The findings reported in this paper indicate a substantial premium for the willingness-to-pay based value of Underground safety relative to that of roads.