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Who would have thought a vast Conservative lead in February could end with a too-close-to-call election day? I’ve assumed either a very narrow Tory majority or a hung parliament, and asked big cheeses from the residential business across Britain to say what these might mean.
A tiny majority for the Conservatives:
• “Unpalatable fiscal policies of a new government could affect demand and disposable income but buyers usually buy for the medium term and take such issues in their stride. I expect pricing to remain fairly flat this year” (Patrick McCutcheon, head of residential sales at Dacre, Son & Hartley, Yorkshire);
• “There’s strong evidence to point to a significant upturn in the market. This takes place anyway after elections, historic data shows, but it’s usually more pronounced after a Tory victory” (Nigel Lewis, property analyst at FindaProperty.com);
• “Tories means good for business and less tax, so I think a Tory win would get people moving short term but would cause a fall in values over the next six months as supply increases and demand doesn't quite accelerate to keep pace” (Ed Mead, Douglas & Gordon, London);
• “The Conservatives’ agenda is around localism. It is reliant upon financial incentives to get numbers delivered. It is a wishful policy that will see challenges …. It will inevitably stall not encourage housing delivery” (Richard Jones, partner, EC Harris).
A hung parliament:
• “If there is no resolution to tackle the debt issue the UK housing market will be seriously under threat. If our credit rating goes down and our debt is not managed more aggressively we can expect to see interest rates rise and more and more people's homes fall into negative equity” (Matthew Benson, Rettie & Co., Scotland);
• “The much dreaded hung-parliament scenario could lead to a beneficial impact for foreign buyers. A currency crisis might shave yet another 10% or 20% off effective prime London prices for dollar and euro buyers” (Liam Bailey, head of research, Knight Frank);
• “More uncertainty, less confidence, less activity and a much scratchier market. There will be increased activity as buyers and sellers can’t wait any longer to act, but things will be much slower than they would be under a Conservative majority” (James Greenwood, Stacks Property Search);
• “This would be a distinct distraction to buyers and sellers alike and could cause the market to grind to a halt” (Sam Trounson, Cirencester Strutt & Parker);
• “Financial markets dictate investors’ attitude and if the Pound remains steady, we believe that deals will still continue. Our advice to vendors is to carry on regardless” (Laurence Glynne, partner, LDG, central London).
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