House prices set to SURGE as pre-election brakes lifted on back of Tory win
05-19-2015
THE CONSERVATIVES victory at the General Election has injected new confidence into home buyers with property values set to surge in the coming months, say experts.
By Lana Clements
PA Wire
House prices are set to increase in the coming monthsHouse prices dipped by 0.1 per cent nationally last month due to the election, according to Rightmove.
Falls were registered in three out of the ten regions: London, the North East and Yorkshire & the Humber.
The drop was the first fall since the previous general election in 2010 and left the average asking price for properties in the UK at £285,891.
However, the unpredicted majority win for the Tories on May 7 has removed uncertainty for many prospective buyers and sellers, said the property website.
Rightmove are now anticipating a surge of activity if the market mimics the post-election period of 2010, when new sellers' numbers jumped by 17 per cent.
The site added that the removal of the 'mansion tax' threat from Labour will also stimulate the top section of the market.
In April, asking prices hit a record high of £286,133 and it's thought that the latest pause is not set to last, as the Government has still not tackled the issue of long-term lack of supply that is driving up prices.
Miles Shipside, Rightmove director, said: “Whilst activity was buoyant in early spring with demand for suitable housing outstripping the supply of property for sale in much of the country, it seems that pre-election jitters finally came home to roost in the final weeks of electioneering, with the average price of property coming to market dropping at this time of year for the first time in five years.
"This is an election-driven price stall which gives some buyers only short-term relief from the back-drop of a long-term housing shortage, and many estate agents are now reporting a resurgence in interest following the surprise election result.
"Election uncertainty and particularly the threats of financial penalties to landlords and those with properties valued at over £2 million put a brake on the market, and their removal gives a reason for a rebound in activity and prices.”
The new Tory-majority Government faces the long-term challenge of delivering on their manifesto promise to build 275,000 new affordable homes in the next five years.
Mr Shipside added: “Buyers should note that there is often a surge of property supply after an election, as those who have held off coming to market decide to take the plunge.
"Many potential sellers may have held back expecting a period of hung-parliament uncertainty, but they could now decide to catch the late spring market.
"There may be a window for buyers to act now in this late spring market before prices rise in the next few months."