Last month Theresa May announced a snap election scheduled for June 8th, with the vote approved almost unanimously by MPs in the House of Commons. This call for a snap election will mark the third consecutive year where the British public have been required to turn out to the polls, following the EU referendum last year and a General Election in May 2016.
The announcement caused concern for property owners and investors who felt they could be affected by instability in the market. This coupled with recent increases in Stamp Duty and continuing Brexit negotiations, would suggest that the property market would be feeling the pressure. However, this isn’t necessarily the case.
If the bold move made by Theresa May goes as planned – a Conservative Party win with an improved majority – it would provide smoother Brexit negotiations, leading to higher consumer confidence and a boost in housing market activity in the near future.
Regardless of the snap election result however, the demand for property in the UK will continue to rise. As a country with small landmass, an ever-increasing population, coupled with a housing shortage and an increase in single person households, it is clear that the price of homes will continue to increase in the same vein and provide a return on investment for years to come.
Since the vote to leave the EU, the UK property market has seen a huge surge in overseas investors looking to capitalise on the drop in value of the pound, and the market has remained remarkably resilient ever-since. The Telegraph reported that, “Middle and Far Eastern buyers have been particularly active in the last year, almost doubling the amount of money they have spent in the UK’s regional markets in 2016 to around £1.9bn. In total, foreign investors accounted for nearly one third of all investment that took place in the UK regional commercial property market last year.”
Usually, an election is announced much further in advance, giving the market at least six months to consider political uncertainty. However, given the short notice, there has been little chance for an impact on activity. The view that some predicted of a slump in property sales this year, hasn’t transpired and in fact we have seen a rise, meaning that buyers and sellers have continued to go about their business as usual. In a report by the Telegraph earlier this year they found that, “The average house in Britain will be worth £220,000 this year - up £9,000 on 2016 levels”. Despite high profile elections in each of the past two summers, the housing market has remained strong which is testament to the population's desire to move home and not be put off by uncertainty.
At Regency Residential, we feel that property sales show no signs of slowing up. Regardless of the result, the UK will continue to prioritise the demand for housing and drive forward the performance of the already buoyant property investment market, for both domestic and international investors.
At Regency Residential, we provide clients with our expertise in both the private rented sector (PRS) and residential markets, imparting our advice to aid you in making key decisions at every stage of each purchase process. Whether you’re buying a home or investing, Regency Residential’s offering is distinctive, in that we offer secure stand-alone investment property in the UK and international markets.