The General Election took place on 12th December and saw the Conservative and Labour parties battle it out for control of the country. In the end the Conservatives came out on top, securing their largest majority since 1987 after seizing a large number of seats from Labour, in many past Labour-favoured constituencies. The election, on top of the everlasting Brexit debate, has brought an extensive period of political and economic uncertainty throughout the UK, however despite all of this the UK property market has continued to remain strong.
Towards the end of 2019 the political uncertainty reached its pinnacle with the General Election and Brexit looming, however Halifax reported in their house price index that the average price of a house in November 2019 had increased by 2.1% from the previous year and 1% from the previous month. This monthly growth was the largest increase since February and came as somewhat of a surprise after Halifax themselves had forecast a 0.7% decrease. It seemed that the promise of the end of the political uncertainty was enough to inspire a drastic improvement in the UK housing market, and now that the election has been and gone, a resolution for Brexit is imminent.
A recent report found that around 55% of UK property investors have paused any investment plans over the last six months as they await the outcome of Brexit and it is estimated that 52% of investors are monitoring properties they are looking to purchase, waiting to see if there is any price fluctuation in the build up to January 31st. With this deadline just around the corner, the UK housing market can expect to continue in this upward trajectory, with house prices forecast to rise by 2% in the coming year.
Miles Shipside, Rightmove director and housing market analyst comments: “The greater certainty afforded by a majority government gives an opportunity for a more active spring moving season, with some release of several years of pent-up demand.”
“Given the Brexit track record to date, further political twists and turns should not be ruled out, though with a large majority there is a higher possibility of an end to the series of Brexit deadlines, and the prospect of an orderly resolution. Rightmove measures the prices of 95% of property coming to market, and we predict that buyers and sellers will on average see a 2% rise in those prices by the end of 2020.”
“While this is over twice the current annual rate of 0.8%, it’s still a relatively marginal increase as it’s a price-sensitive market. There will be regional variations. London is finally showing tentative signs of bottoming out, and we expect a more modest price rise of +1% in all of the southern regions where buyer affordability remains most stretched. In contrast, the largest increases will be in the more northerly regions, repeating the pattern of 2019 with increases in the range of 2% to 4%.”
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