The decision by British Prime Minister Theresa May to announce a surprise general election in just a few weeks’ time is unlikely to have much of an impact on the nation’s property markets.
It is generally felt that as there is not time before the vote on the 08 June for a long period of uncertainty to build up and the economy could be strengthened by the decision.
Indeed, a snap poll of home sellers and buyers has found that neither see the election as putting them off with their plans to move home. Some 56.7% of sellers said that they would be continuing although 24.4% said the decision has left them undecided and 18.4% are going to wait until the result.
The survey from online estate agent eMoov also found that 59.2% of buyers believe that the decision will not affect them and they plan to continue to purchase a property while 22.7% said the news had left them undecided and 17.5% are now going to wait until after the result of the election.
‘This initial look at both buyer and seller sentiment shows that the news of a snap election has failed to deter the majority of UK home sellers and buyers. It is a bold move by Theresa May and one that will look to settle any underlying opposition within the UK government around Britain’s decision to leave the European Union,’ said Russell Quirk, eMoov chief executive officer.
‘Since the vote to leave the EU we’ve seen the market remain remarkably resilient despite a degree of buyer uncertainty. Therefore, the eradication of questions around the legitimacy of the EU vote, a second referendum and any other opposition will only serve to buoy the housing market further and should see a large degree of stability return going forward,’ he added.
Jonathan Stephens, managing director of Surrenden Invest, pointed out that unlike usual general elections, where contending parties draw up their manifestos and there is a degree of uncertainty as to the outcome, there is a general view that the current Government will gain from the vote.
‘When it comes to the UK property market, it’ll be business as usual. There remains a chronic undersupply of housing and for whoever ends up in power as a result of this general election, building more homes and supporting the UK property sector will no doubt be at the top of their agenda,’ he added.
The election is positive news for the property market, according to Jean Liggett, chief executive officer of Properties of The World. ‘Markets in the UK dislike uncertainty and crave certainty. This certainty will positively impact on the UK property market, resulting in increased sales, increased prices or at least no decreases,’ she said.
‘UK and worldwide property investors will continue to make the UK a primary market for them to invest in,’ she explained but added that it is an opportunity to campaign for changes that will improve the market such as scrapping stamp duty on the first £125,000 for buy to let investors, bring back tax relief on buy to let mortgage payments and provide funds for local councils to build more homes.
Ed Heaton, managing partner of property search agency Heaton & Partners, also believes it is a positive move for property. ‘The snap nature of the announcement, means that there has been no long build up with buyers and sellers wanting to hold off. Whilst the outcome is widely expected to be a Tory landslide, the element of uncertainty is limited because of this. The prospect of five more years of Conservative rules will be seen by many as a real positive,’ he pointed out.
High demand and low levels of supply also mean that election uncertainty is unlikely to kick in, according to Philip Woolner, joint managing partner of Cheffins. ‘It is unlikely that we will see any real effect on activity in the run up to 08 June. Any kind of instability can easily frighten investors or property buyers, however we would expect that the impact of this snap election may simply elongate people’s decision making process on whether to move or invest in property,’ he said.
‘The run up to the election is short and should the polls be correct and the Conservatives win with a decent majority, we would expect a boost in the market as many property investors will welcome another five years of Conservative government,’ he added.