Election? What Election? For 95% of home movers, it’s business as usual

It’s hard to ignore the fact that the UK will be going to the polls for a general election on 4th July. Ever since the Prime Minister’s rain-soaked announcement on May 22nd, each political party has been loudly competing for our attention.

With so much focus on the political changes ahead, you might imagine that London’s home movers are pausing their plans to see what will happen with a new government in place. Surprisingly, however, Rightmove’s research shows that the capital’s residents are largely undeterred by the prospect of an upcoming election.

What’s happening with home movers?

Rightmove has just published the results of its spring survey, which collected the views of 14,322 home buyers and sellers across the UK.

A very substantial 95 per cent of those who took part told Rightmove they had no intention of delaying their plans due to the election.

A similar survey, specifically targeting individuals in prime central London areas, found that 79 per cent of the 1,200 respondents didn’t plan to change their plans because of the election. In fact, 13 per cent of prime London residents said they had actually increased their determination to move within 12 months.

The survey also revealed that 32 per cent of home movers – primarily first-time buyers and upsizers - were committed to move within six months.

That is the highest level recorded in two years.

How much do elections affect the property market?

Despite the long-held belief that housing market activity tends to slow down before an election, there is little evidence to back up this view.

Rightmove recently carried out some analysis on pre-election data. This showed that in the run-up to each of the last two elections, the market remained steady.

London home movers, in particular, seem indifferent to the drama of a general election. An analysis of the London House Price Index dating back to 1995 has shown that elections have virtually no impact on rising property prices in the capital.

Will falling inflation help buyers and sellers?

Inflation has now fallen from 11 per cent in October 2022 to just 2.3 per cent, which is close to the Bank of England’s target of 2 per cent. The prospect of an imminent drop in the Bank of England’s base rate (which affects the cost of mortgages) should provide a further boost for the housing market in London.

In the prime central London market, falling mortgage costs are already starting to correct the unequal balance between cash buyers and mortgage-dependent buyers. Going forward, it is expected that cash and equity-rich purchasers will lose a little of the dominance they have enjoyed since the mini-budget.

What’s happening in the housing market now?

Although mortgage rates remain at around 4.5% to 5%, market activity continues to improve, with more properties listed. This is a clear sign that sellers' confidence is growing.

The property website Zoopla notes that 392,000 homes are currently making their way through the sales pipeline, a figure that is 3 per cent higher than at this time last year. If these transactions convert into successful sales, it could result in a significant boost for UK sales figures by the end of the year.

Zoopla also reports that there is a strong incentive to move among certain groups. First-time buyers are motivated to buy because of the rapid growth in rental costs, while upsizers who put off moving last year (when mortgage rates rose) are now making up for lost time.

Have home buyers’ priorities changed?

We have seen many changes in homebuyer trends since the last election in 2019. Post-pandemic preferences for outdoor areas and work from home spaces have now moved on. Buyers are now looking for better room sizes and flexible properties that offer more space.

Energy-saving features such as insulation, efficient boilers and smart technology systems are also high on most buyers’ wish lists.

Can we expect a post-election boost in confidence?

The UK economy has experienced some difficult years. Although wages have gone up, many homeowners are still experiencing financial challenges. However, confidence is likely to grow with a new government in place for the next five years.

In the first quarter of the year, prime central London prices saw a small uptick (0.1 per cent), and some forecasters have predicted a rise of 3.5 per cent for 2025.

It’s impossible to know exactly how policies introduced by the new government will affect house prices in the long term. However, our agents in Westminster, London Bridge and Kennington will follow the latest developments to keep you updated.

We’re always happy to help you find the perfect property, whether it’s an investment or your next home. So why not call us and share your moving plans today?