How Will the Election Affect Property Prices

The date is set for May the 6th, now is the time to consider how this election will affect the property market in terms of activity and prices.

Markets are as much about sentiment as supply and demand. This election brings with it a fair amount of uncertainty, the bookies claim that the Conservatives are favourites to win; others claim that there will be a hung Parliament.

If there is a clear winner, perhaps a Conservative win, prices may creep upwards. If there is a Hung Parliament, or Labour remains in power, they will remain level or indeed may even drop.

It is still quite a difficult time for the property market; we are vulnerable to any changes, especially political. At present we are riding on the back of cash and equity rich buyers chasing very few properties. Undoubtedly an outright majority would be the most beneficial outcome for the housing market.

Mortgage lending is still sluggish, and the market is quite dependant on sentiment. These factors make for a period of uncertainty leading up to the election. Transactions may be low in the lead up to and during the aftermath of the election, while people catch their breath. This could cause a fluctuation in prices.

The housing market will only be truly stable and grow under a new governing body if there is to be a general economic recovery, clarity on interest rate movements, true extent of public spending cuts revealed, availability of mortgage finance, Incentives to expand in the private rental sector, new housebuilding, increase in property stock, stamp duty and other hindering factors.

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