General Election could put the Brakes on the Property Market
Most industry insiders expect the snap general election to prolong the dip the housing market is currently going through, although it will bounce back.
Uncertainty was certainly the watchword for the property market in 2016, and with the announcement of a snapgeneral election and the triggering of article 50, it seems there's plenty more uncertainty to come over the next year. In fact, there are concerns that Theresa May's shock announcement could put an already sluggish property market on pause this summer as potential buyers sit it out to await the outcome of the election.
These predictions come on the back of research that shows the property market is already in a slump. The Royal Institution of Chartered Surveyors (RICS) recently reported that the number of properties on estate agents' books has fallen to a record low given the current lack of impetus in the market. There were just 43 unsold properties per branch on average in March, the lowest number since RICS started collecting data.
The indecision starts here
The announcement of a general election has come as a huge surprise to most and traditionally this type of unexpected macroeconomic event has put the dampeners on the property market. Typically, homebuyers who are well on the way to making a purchase will not be deterred, but those who are only thinking about making a purchase usually decide to pause.
That means most industry insiders expect the sluggish period the housing market is currently going through to continue, with the general election likely to increase its duration. Certainly, there is unlikely to be any uplift in the market between now and 8 June.
A surge in housing market activity to come
Whatever the outcome of the general election, past trends have shown that a decisive result will lead to an increase in property market activity as soon as the votes are in. Analysis of property transactions over the last nine general elections has shown a dip in pre-election activity, followed by a post-election boom.
Certainly, whoever wins the election will start with a clean state and that can only be a good thing for the property market. The figures show that the highest levels of activity are typically in the three months immediately after the election of a new government. At this time, sales are around 13 percent higher than the usual levels.
Thankfully, the period of time from now until the general election is relatively short. That means any indecision will quickly be cancelled out by an increase in sales following the election, with a reduced impact overall.
What do buyers and sellers plan to do?
According to a recent survey of those planning to buy or sell their house in the near future, 57 percent of prospective sellers said they would go ahead with their decision despite the election, while only 18 percent said they would now wait. There was a similar level of commitment among those looking to buy, with 59 percent still planning to go ahead with their purchase, and 18 percent putting their plans on hold.
Whatever you plan to do, it is business as usual here at Martin & Co. Camberley. We will continue to work with buyers and sellers to help you achieve the best price possible for your property and guide you seamlessly through your purchase. For more information, please call 01276 691510 or email: firstname.lastname@example.org today.
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