A recent report in the mirror announced that David Cameron's overwhelmingly successful re-election will now see house prices continue to increase in the UK. The tabloid actually states an impressive rate of £100 per day, taking the average house price to £200,000.
[source: http://www.mirror.co.uk/news/uk-news/general-election-2015-house-prices-5663650]
It is said that at 10pm on the dot of the election results announcement, a "frenzy" of million pound properties were brought to market. And sold! Apparently the absence of the mansion tax, as threatened by the opposing party, gave home owners and potential buyers the confidence to go to market.
But what is the underlying reason for this general and sudden upsurge?
Political stability aids global economic stability and therefore financial success. "Martin Ellis of the Halifax added, "Housing demand is being supported by a number of factors including economic improvement, rising employment and low mortgage rates". So... all is looking positive for the UK property market.
The only drawback …
can supply meet demand? Property Correspondent, Anna White, states that with "30 years of neglect, a chronic supply crisis has enveloped Britain, especially in the South East". And in that case, is the Tories promise to help people to buy a home actually helpful? Less so if there are few houses available to buy and therefore, once again, putting the emphasis back on rising prices.
The Conservatives did pledge to build 200,000 discounted starter homes to aid first time buyers. But it is London that is most in-need and London will not benefit from this manifesto inclusion. The National Housing Federation estimates that only 15% of London-based renters would actually be able to buy in the current conditions.
In the Guardian, Richard Brown suggests a possible solution, "There is also a case to be made for pooling developers' affordable housing payments across London to support a London-wide programme for affordable housing." Of course, we all know that living in central London is always going to be a premium investment and therefore he adds, "The next mayor may also want to encourage higher densities to outer London, or push to look again at London's green belt, and ask where releasing land (perhaps under public sector control) might provide more housing and more enjoyable green space."
The obvious summary is that politics and governments play a key role in the way (place) we physically live our lives in the UK. Investment support is on offer with the ongoing "help-to-buy" scheme and the development of new properties is certainly not being overlooked. In fact, the government did release a new policy paper on May 7th that clearly states that the government has a priority to rectify the situation of inadequate property construction since 2009.
Dawson & Associates sees opportunities arising in the next phase of the UK's property market. There is a renewed focus and an understanding of its importance from all sectors. The perceived market stability will not only aid private investment but also corporate development which should open up more property options.
Dawson Surveyors is based in East Sussex and we maintain constant connection with central London – and with over 45 years of Property experience, there isn't much that we haven't seen before. So, if you're looking for some impartial property advice – whether that is an overview of where and how is best to invest or a building survey to ensure that the home that you've seen is structurally sound – please contact us. Initial advice is free of charge.
Registration forms for the Help to Buy: Equity Loan scheme can be downloaded here
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