Both 'uncertainty' and 'stability' are buzzwords that seem to be having a bit of a heyday at the moment. Particularly since the recent general election saw Theresa May lose the Conservative majority she'd been hoping for in the run up to the Brexit negotiations. With all these feelings of doubt and apprehension bouncing around, will there be any negative effects on the UK housing market?
Strong and stable prices
Before the general election . Firstly, that some of that dreaded uncertainty might cause a wobble in prices. Secondly, that the current housing shortage and the cross-party plans to increase property building could mean we’re unlikely to see prices rise or fall significantly in the long-term. Both of those calls, we’re pleased to say, still look about right.
The combination of the pre-election 'wait-and-see' mentality among homeowners and the post-election hung parliament did cause a minor slowdown in house prices, . However, despite predictions of doom and gloom from , results from home builders and , and show that both prices and demand remain high.
The main reason for these stable home values is that there are still not enough houses to meet demand. Political turmoil, as well as putting people off buying a home, also makes builders nervous about investing in new projects and so delays any increase in new properties. And, or puts the brakes on plans to boost house building, we could see further delays with new housing stock. That’s likely to cause prices to rise even further.
The good news for first-time buyers is that the for international investors. That means there’s still money coming in, and builders won’t be as nervous as they otherwise might have been. Meanwhile other measures like the have cut demand from the buy-to-rent market, reducing that upward pressure on prices.
So as the hung parliament takes shape, we can expect to see more activity from both builders and buyers. That should put us back on track for the steady price growth forecast for 2017, without delivering any nasty surprises.