A new report from Rightmove suggests that potential home buyers are unfazed by the recent news of the general election. Do potential home buyers have nerves of steel or are there good reasons for them not to be upset?
“Typically, people think that political uncertainty will cause ripples in the housing market. However, you may be surprised to learn that general elections don't typically create uncertainty for buyers and sellers. So, if you're worried that a general election will derail your property buying goals, speak to our sales team – we have great news for you.”
“This is not only something that the statistics tell us, but also something I can attest to from my experience working in the sales department at Foxtons through the last election.
“There is actually a lot of optimism surrounding the election. After the election, buyers will be more active and house prices will rise.”
“Buyer sentiment has been positive this spring, and we hope our customers will be pleasantly surprised by the opportunities we have to offer them this summer.”
~Jean Jameson, Chief Commercial Officer, Foxtons
Over 14,322 home buyers can't be wrong
Before the election was announced, we reported that buyer demand was on the rise, with Foxton's sales team riding high on the spring momentum, handily surpassing last year's applicant numbers.
Then, on May 22nd, Rishi stood in the rain outside 10 Downing Street, called an election and challenged everyone's timetables… as you might expect. Did the general election actually affect everyone's plans?
As part of a herculean effort to reassure sellers and empower buyers once the election results were announced, Rightmove surveyed more than 14,322 people planning to move, with 95% of respondents saying the election hadn't changed their plans.
Rightmove also looked back at the 2015 and 2019 elections and found that “demand from buyers was consistent leading up to the election and increased after the election” (General Election Spotlight, Rightmove).
Keep Calm and Move Forward: Foxton's Analysis
We did our own research and by looking at sales figures in London over the past few years, we can get a clearer understanding of how elections, other political events and non-political factors affect Londoners' willingness to sell.
Looking at the majority of the data (1997-2015), elections occurred in the midst of rising sales, and sales continued to rise after the elections.
Other factors
Of course, seasonality also matters: Most elections take place in the summer, which often coincides with the real estate market's natural boom.
In 2017, unelected leader Theresa May called a surprise general election after the Brexit vote. The 2019 general election in mid-December took place amid a downward trend and ahead of Brexit coming into effect. Home sellers faced more problems politically than just an election, and in London they did not see the same motivation as in previous years.
On the rise
Read: How to make your home stand out in a busy market
This graph becomes most interesting given that sales volumes are increasing again.
Zoopla has published its latest house price index, announcing that the number of homes for sale in the UK increased by 20% in the year to April, “leading to the highest number of homes for sale in the past eight years”.
Will transaction volumes continue to rise after the election as more homeowners decide to move? It's hard to say, but if you're feeling inspired to start selling, now is a good time to book a free valuation with Foxtons.
The big picture
Another question that arises from this graph is how much of an impact does the election actually have on the market? In the long run, it doesn't seem to have any impact on London property values.
We analyse the London House Price Index before and after each general election and find that general elections have little effect on house price growth in London.
This follows previous analysis of house prices over the past 20 years in the Foxtons London Report 2023, which demonstrated that not even the global financial crisis, the Brexit referendum or a global pandemic can halt the long-term growth in house prices in London.
Buyers and sellers should follow these steps:
Now is a great time to check:
How will market changes affect my property sale?
Thinking of selling?
Understanding your local London market is key to a successful sale, which can be very different to what is happening in the wider UK market.
So, request a Foxtons valuation and we’ll use our decades of data and expertise to navigate market changes and help you set the perfect asking price for your unique property.
Considering a purchase?
To get a clear idea of what you can pay, we highly recommend speaking to a mortgage broker like Alexander Hall, who can give you a much more accurate price range than any mortgage calculator can.
Alexander Hall can help you make the most of rising mortgage approval rates, we can even issue you with an in-principle mortgage agreement to support your offer and provide expert support for your case, no matter what the summer 2024 market holds.
Start your search: Browse London homes for sale.
