The impact of the UK General Election on the property market: Anticipating a post-election surge

As the UK approaches its general election on 4th of July this year, the property market finds itself in a familiar state of limbo. Some buyers, sellers and landlords are likely to adopt a cautious "wait-and-see" stance, leading to a potential decrease in market activity. However, experts predict that any such period of uncertainty will soon give way to a surge in demand, driven by anticipated interest rate cuts and political stability. Interestingly, we have also spoken to several of our clients here at PropertyStream who have reported high levels of  activity in their local market throughout the month of May.

Pre-election uncertainty and market hesitation

Political uncertainty has long been a key factor influencing the property market in the lead-up to general elections. Potential changes in government policies make buyers, sellers and landlords  wary of making significant financial commitments. Historical data shows a recurring pattern of reduced market activity during the months preceding elections, such as in 2010, 2015, 2017, and 2019. This trend underscores the cautious approach taken by market participants during politically volatile times.

Current market conditions

Recent figures from Halifax's House Price Index reveal that the average house price across the UK remained relatively stable in May, decreasing by just £170 to £288,688. This slight dip reflects the broader trend of market hesitation. Some estate agents reported quieter activity during a month traditionally busy for property transactions, highlighting the impact of election uncertainty.

Despite this, the year-on-year price increase of 1.5% and wage growth of 6% indicate improving affordability for buyers. In London, where the average home costs £536,821, prices remained nearly flat compared to the previous year, further emphasising that slightly subdued market conditions can be results of the upcoming general election on 4th July.

Post-election surge: a market ready to rebound

However, there is good news on the horizon. Industry experts suggest that the current lull in the property market is setting the stage for a significant rebound post-election. As reported in The Standard on 7th June, some property experts believe that the market is "primed to surge" once the election uncertainty dissipates and interest rates begin to fall. Furthermore, these experts predict that the current "plodding equilibrium" is unlikely to last, with consumer confidence and economic growth poised to drive a strong summer rebound.

This anticipated surge is bolstered by historical precedents. Following the 2019 general election, the property market experienced the "Boris bounce," with a notable increase in house prices after Boris Johnson's Conservative Party secured a landslide victory. Similarly, should Labour win the upcoming election, a "Starmer spurt" could occur, driven by their housing-focused manifesto, which includes plans to build 1.5 million new homes and make the low-deposit mortgage guarantee deal permanent.

Investor sentiment and strategic approaches

Investor sentiment often shifts significantly during election periods, with both domestic and international investors adopting a more cautious approach. The potential for policy changes that could impact property values and investment returns drives this caution. However, savvy investors can find opportunities in a quieter market, particularly if they stay informed about political developments and market trends.

For buyers and sellers, timing is crucial. Buyers may find advantageous deals during the pre-election period, while sellers should be prepared for potential delays in transactions. Both parties should be ready to act quickly once the election results are clear, taking advantage of the anticipated market surge.

Proactive strategies for estate agents during the lull

If you are experiencing that the property market is in a state of 'hesitation', this period presents a unique opportunity for estate agents to prepare for the anticipated post-election surge. Utilising this time effectively can ensure that agents are ready to capitalise on the potentially increased market activity.

Here are three recommendations estate agents should focus on if they are experiencing a quiet period due to the upcoming general election:

1. Website refresh and SEO:

This is an ideal time to refresh your estate agent website design, upgrade your current site, or even launch a new one. A modern, user-friendly website can be up and running within four weeks. Furthermore, understanding and improving your website's performance on Google is crucial. Partner with an agency that has proven SEO results for estate agents, such as PropertyStream. Ensuring your website ranks highly on search engines will maximise visibility and attract more traffic, translating into potential new customers.

2. Marketing campaigns and strategy preparation:

With the summer holidays approaching, now is the perfect time to create a marketing campaign that can be deployed quickly. Additionally, prepare for the autumn market by establishing your marketing strategy, campaigns and materials for the third and fourth quarters of 2024. Commission an agency like PropertyStream to develop seamless campaigns with striking materials for direct mail, animations for social media, smart landing pages for your digital marketing campaigns and engaging blog content for your website. 

3. Review your marketing and presentation materials:

Elevate your marketing game by creating standout materials that drive property valuations. Refresh your valuation packs, estate agency brochures and direct mail to ensure these leave-behind marketing items present your agency in the best light. At PropertyStream, we specialise in creating exceptional marketing materials that make your agency stand out in a competitive market. Powerful print marketing such as company brochures, selling or letting guides and eye-catching valuation folders should never be underestimated - these represent your brand on the kitchen table of potential clients and should look the bee's knees.

To wrap up...

According to some property experts, the UK's property market is currently in a state of 'anticipation and 'wait and see' as the general election approaches. However, the underlying dynamics suggest that this is merely the calm before the storm. With pent-up demand from buyers and potential interest rate cuts on the horizon, the market is poised for a robust rebound post-election. 

By understanding these trends and adopting strategic approaches, buyers, sellers, and investors can navigate the complexities of the property market during this politically charged period. For estate agents, now is the time to get your house in order and prepare for the anticipated surge, ensuring you are ready to seize the opportunities that lie ahead.

If you would like help in refreshing your website, brand or marketing, give us a call on 0333 242 0647 or email enquiries@propertystream.co