HS2 is now generating more than £14million a year by renting out hundreds of homes bought along the route of the cancelled and curtailed high-speed rail project, according to new reports.
Data shows that 602 of the 782 residential properties voluntarily purchased by HS2 Ltd since the scheme was approved in 2012 are currently occupied by tenants.
Nearly half of the homes being let are located on stretches of the railway that are no longer being built, the Telegraph reported.
The northern legs of HS2, which were intended to extend the line from Birmingham to Manchester and Leeds, were scrapped by then prime minister Rishi Sunak in October 2023.
Despite the cancellation, properties acquired along those routes have largely remained in the HS2 rental portfolio.
Between Birmingham and Crewe, 121 of the 122 homes purchased by the company are now rented out, according to the data.
Along the first phase of the line between London and Birmingham, tenants pay an average monthly rent of more than £2,100.
Rental prices are lower on the section originally planned to run towards Manchester, where the average monthly rent stands at around £1,733.
Across its property portfolio, HS2 Ltd is collecting approximately £14.1million in rental income each year.
The revenue represents a small fraction of the total cost of the project, which has escalated significantly since its approval.
HS2 is now forecast to cost taxpayers £81billion at 2019 prices, rising above £100billion once inflation is included.
HS2 is now forecast to cost taxpayers £81billion at 2019 prices
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When the project was first approved in 2012, the estimated cost of building the full network stood at £33billion.
That figure was revised to £57.5billion three years later as construction and land acquisition costs increased.
Joanna Marchong, a researcher at the Adam Smith Institute think tank, questioned how the rental income is being used.
“It is unclear whether this money is going back to the Exchequer or whether it is being used to reduce the cost of the project.”
She added: “HS2 should explain why it is continuing to hold and rent properties on cancelled sections of the line and whether this income is offsetting taxpayer funding.”
Penny Gaines, chairman of Stop HS2, said the rental revenue was insignificant when compared with the scale of spending on the railway.
“£14million from rent might sound like a lot of money, but it is dwarfed by the ongoing cost of HS2.”
More than £7billion of Government funding was spent on the project in the last financial year alone
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She noted that more than £7billion of Government funding was spent on the project in the last financial year alone.
Ms Gaines also called for properties acquired for HS2 but no longer required to be offered back to their former owners.
She said homeowners should be given the opportunity to repurchase properties at the price HS2 originally paid for them.
HS2 Ltd said rental income from its property holdings ultimately benefits taxpayers.
A spokesman for the company said: “Rent charged on properties acquired for HS2 is income for the taxpayer, ultimately offsetting costs incurred by the project.”
The route of the railway through rural areas meant HS2 had acquired a large number of detached homes with higher market rental values.
HS2 Ltd has previously said it rents out properties that are not immediately required for construction to reduce the ongoing cost of holding empty homes.
Rail Minister during Hs2 Lord Peter Hendy
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The railway was first proposed more than thirteen years ago and is now expected to open no earlier than 2033.
Transport Secretary Heidi Alexander has previously described the scheme as an “appalling mess”.
In November, HS2 Ltd announced plans to sell surplus land around stations and the main depot along the 140-mile London to Birmingham route.
The company said land sales would begin once plots were no longer required for construction or operational purposes.
A Department for Transport spokesman said the disposal of surplus assets would be carried out “in a sensitive and sensible way” to secure the best possible outcome for taxpayers.