Post-election ‘bounces’ don’t deliver says big estate agency

Waiting to put a property on the market after the forthcoming General Election in a bid to gain a higher price could prove to be a risky strategy, research from Winkworth reveals.

Research by analysts Dataloft, commissioned by Winkworth, looked at price changes before and after the six General Elections since May 1997.

PRICES INCREASED

Using Land Registry figures the research showed in the three months before the December 2019 election prices increased across the UK by 4.2%.

Three months after the election the price increase was just 0.7% and in prime central London the change in price growth was -9.4%. Prices rose by almost the same percentage in advance of Tony Blair’s win in 1997, as before Boris Johnson’s victory in 2019.

Prices continued to grow in the three months post-election.”

Only in the 2005, 2010 and 2017 elections did the price growth surpass the preceding period. In the remaining four elections, prices continued to grow in the three months post-election, but at a lower rate.

According to the research pre-election uncertainty has a short-term impact, slowing the number of sales in the three to four months before voting day. This pattern holds true for six out of the last seven elections. Once the election result is known, the increased certainty over the political landscape and policies will normally allow the markets to pick up momentum again.

RISKY STRATEGY

Dataloft’s report states: “Waiting to put a property on the market after an election, with the hope of achieving a much higher price could be a risky strategy.”

Speaking on Winkworth’s Property Exchange podcast Dominic Agace, Winkworth’s Chief Executive, says: “The biggest house price growth came when Blair was in power.

“We saw a rise of £48 a day on the average property price, which is contrary to popular belief that the Thatcher era saw the biggest growth due to Right to Buy.”

He adds: “Politicians are pushing policies to win votes and the politics can be more extreme than the reality of what happens once a party is in power. In 2019, there was a binary choice between Corbyn and Johnson. From a property perspective, housebuilders would probably prefer to see a Labour government – that must be a first.”

List to the podcast HERE.