The Conservatives have won a majority in the General Election and this bodes well for the housing market, experts say.
The general consensus seems to be that since the Tories have won there will be no major changes in policy for the private rented sector (PRS) and the threat of Mansion Tax is gone.
The Conservative win means stability and continuity on the market, which is exactly what it needs, according to experts.
London estate agent Chestertons expects both sales and lettings to soar after the “decisive result” in yesterday’s General Election.
Robert Bartlett, group CEO of Chestertons, comments:
“Labour and Lib-Dems both backed the introduction of a Mansion Tax on homes worth more than
£2 million, which would have disproportionally penalised Londoners, especially those with outstanding mortgages or those in retirement who had prudently invested in property as a nest egg. As a result, many people were holding their breath and waiting before making a decision to buy or sell.
“Likewise, Labour’s proposed new laws for the private rented sector would have seen compulsory registration schemes, direct rent controls, fixed-term tenancies and added overheads for private landlords shortening the supply of decent rented homes and ultimately pushing up rents.
“With these proposals off the table, and the spectre of political uncertainty finally lifted, we can now all move on. We are already predicting the next few weeks and months will be very busy indeed.
“There are still issues to be addressed in the property sector in London, not least the need to boost housing supply, make the rental market more transparent and accessible, and unlocking opportunities for regeneration through a joined-up approach to planning and infrastructure delivery. We hope the new Government will continue to work with the property sector and consult properly on proposed changes so together we ensure that any new policies will work as they are intended and can help deliver the long-term sustainable growth and sensible innovations that our industry requires.”
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Robert Haigh, Chestertons’ director of professional services, adds: “I think it is an excellent result for the stability of the market. People can now move forward and look to the future with certainty.
From a London point of view I think it means foreign investment and relocation to the city will now continue unabated due to the fact that the proposed abolition of non-dom status is no longer a threat.”
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Richard Davies, Chestertons’ head of residential, concludes:
“The prime residential markets in London will certainly welcome the clarity this result brings. Many clients in higher-value properties will have been making contingencies for a Mansion Tax coming in, while landlords will also have been scratching their heads at the raft of changes Labour would have implemented. Now the fog of uncertainty has lifted and the way ahead is clear; homeowners and landlords alike can look forward to sustained growth and dynamism returning to the market.”
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Bob Young, chief executive of specialist lender Fleet Mortgages, also points out the advantages of a Tory win for the property market. He comments:
“There are clearly a number of positives for the housing and mortgage market from this Conservative Party victory, not least the fact that the Tories tend to be far less interventionist than the Labour Party which means they are unlikely to meddle in the housing market, particularly the private rental sector. We are all acutely aware of the overwhelming need to build more houses in the UK however the problem may be a lack of materials and manpower – many thousands of construction workers exited the industry back in 2008 and haven’t been replaced.
“Therefore the promises of more housing supply, especially those made by the Labour Party during the campaign, were simply not achievable. The capital markets will be positive about the result because of the stability provided and this is likely to hold firm at least until we’re faced with the EU referendum. Perhaps more importantly though, I think the fact a Government majority has been achieved will provide a real boost of confidence to the UK populous – which admittedly is hard to measure but critical to a nation’s success – and that will be very good overall for our country.”
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Harpal Singh, managing director at comparison website Broker Conveyancing, underscores the importance of stability in his comments about the election result:
“The last thing the current, rather delicate, housing market or the wider UK economy needed was any whiff of uncertainty or implementation of radical changes. Therefore the fact that the Conservatives appear to have won a small majority means that I believe, regardless of political persuasion, those businesses who are in anyway linked to the property sector should probably breathe at least a small sigh of relief this morning.
“What we need now is to develop the UK housing market, in particular, increasing housing supply for both ownership and rental which should be the number one priority for this new Conservative Government. The time really has come to deliver in this area and let’s hope we see real progress over the course of the next five years.”
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Rob Clifford, chief executive of estate agency Century 21 UK and director at national mortgage broker, Moneyquest, believes the lettings industry has “dodged a bullet” with the election result:
“From our perspective, with the forecast currently being for a slim Conservative Party majority, we are pleased there is a level of continuity between the last Government and the next, which we think is crucial for the markets we operate in. In terms of the lettings agency side of our business, we feel the result is a bullet dodged given the onerous regulation we could have expected from a Government led by the Labour Party.
“We fundamentally believe these measures would have failed to deliver the consumer benefits suggested and therefore it is a welcome move that the lettings sector looks highly unlikely to now be saddled with such measures. Overall, the result appears to be a positive outcome for both the financial services and agency marketplaces in which we operate, and there is a significant level of confidence about the growth and development we can achieve within this new political environment.”
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Adam Challis, head of residential research at commercial and residential property services provider JLL, comments:
“These results provide an even stronger Conservative mandate than under the previous parliament. This is good news for the housing market, particularly in London.
“We expect an immediate boost to the Capital, where Labour policy ideas were acting as a drag on activity. Price growth this year should hold at circa 5-6%.
“The real job that begins today is to set out a clear plan to boost new home supply. A stronger housebuilding sector is the only way to solve the UK’s housing crisis, while also adding construction jobs.
“Continuity of housing policy will strengthen the chances that the UK will make strides to solve the housing crisis. This election result is a win for struggling renters, aspirant first-time buyers and even the bank of mum and dad.”
