Election result has minimal impact on property market
Despite the shock of a snap election and a result that ultimately saw Theresa May and the Conservative government lose the majority, the UK property market has unsurprisingly remained resilient as UK property remains attractive to investors.
Historically speaking, general elections have not resulted in significant changes to house price trends or house price movements before or after an election *.
Between the months of April and May prices in England and Wales rose 0.4% **, despite the uncertainties of the June general election. Prices were up 4.7% on an annual basis, taking the average price of a property to £482,779 - the biggest jump since the start of the year.
Housing economist Martin Ellis at Halifax believes Britain’s property shortage will continue to support house price growth. He said, “The fact that the supply of new homes and existing properties available for sale remains low, combined with historically low mortgage rates and a high employment rate, is likely to support house price levels over the coming months.”
House prices in the UK are still rising on a year-on-year basis, although the growth rate has been slowing. The imbalance of supply and demand in the UK property market has essentially helped to drive the first rise in house prices in five months in May.
Looking ahead, new research from Barclays Bank forecasts that house prices over the next five years will rise fastest in Richmond by 39.1%, Camden by 33.9%, Westminster by 31.9% and Wandsworth by 31.1%.
However, the number of property transactions in London still remains slow as the number of properties coming on to the market fell for the 14th consecutive month, according to the Royal Institute of Chartered Surveyors monthly report. House prices have also slowed across the UK, except at the higher end of the London market, where prices remain flat at best or under downward pressure.
* Nationwide house price index, May report
** Halifax house price index, May report