Election 2024 - what impact on the housing market?

We’re two weeks into the election campaign and there’s an increasing volume of evidence pointing to it having only limited impact on the housing market.

Data from Compare My Move - looking at the last seven General Elections - suggests that house prices tend to rise in the 12 months immediately after a general election, by an average of 4.6%.

On average, house prices rise by 1.1% more under a Labour government than a Conservative government.

House prices rose the most (8%) 12 months after the 2015 General Election, in which the Conservatives and David Cameron won a majority; house prices rise an average of 7.4% when the general election ends in a majority, compared to only 0.5% when ending in a hung parliament.

However, Compare My Move says while the average state of house prices 12 months after a general election is positive, the specifics of the election can impact house prices.

It states: “One of the biggest factors of an election regarding house prices that we have seen since 2005 is whether or not the winning party has won by a majority. When a party wins by a majority house prices rise on average 6.9% more than if the election ends on a hung parliament.”

And managing director Dave Sayce adds: “Stability is crucial to a beneficial property market, and a hung parliament will affect the stability to an extent. However, this doesn’t necessarily mean that house prices will fall as they did after the 2010 General Election, they could just rise more gradually than if we had a majority, as we saw in 2017.

“If you are thinking of selling your house then you could make an average of 6.9% more on your house price as the opinion polls are not predicting a hung parliament. However, there is no knowing how house prices will change, even when looking at previous elections, and as we have seen, house prices could go down as well as up.”

Meanwhile Guy Gittins, chief executive of Foxtons, says: “Despite lthe announcement of a general election, we’ve not seen a dampening of sentiment from buyers and sellers; in fact, last week we saw more sales agreed than we have done at any point during the same period in the past six years.

“The prospect of a change in government hasn’t deterred new buyers from entering the market either, with last week also a record number of new applicant enquiries compared with the past five years. As buyers and sellers await the next interest rate decision, they should take some confidence from the fact that homeowners and prospective buyers are acting with confidence despite the uncertainty of the election ahead .”