The Conservative victory in the 2015 general election will boos the UK housing market, property experts have claimed.
David Cameron and his party secured another five years in Government after a securing 331 seats and a working majority in the House of Commons.
Property services company The Romans Group now believe that Conservative plans to stimulate the housing market indicate it has a strong future in the UK. The term is likely to see the introduction of a Help to Buy ISA and a revival of Baroness Thatcher’s right to buy scheme.
Peter Fuller, managing director of the Romans Group, said: ‘Demand from buyers and tenants is still greater than supply; so it’s important that all homes bought through the Right to Buy scheme are replaced. This will happen as long as local authorities are given the power from the Government to reinvest money into more house building to satisfy the demand.’
The UK housing market has become increasingly difficult for first time buyers to get on the property ladder.
But from Autumn 2015, the new Help to Buy ISA will be introduced which will assist those wishing to get onto the property ladder to save for a deposit. For every £200 a would-be buyer saves, the government will add £50, up to the value of £3k.
Additionally, Mr Cameron has announced that the Right to Buy scheme will be extended, offering 1.3 million Housing Association tenants the opportunity to purchase their property at a significant discount. Right to Buy was initially introduced in 1980 and between then and 1996, tenants at discounted rates bought 2.2m homes.
Councils will also be required to sell about 5 per cent of their remaining council stock which is expected to release £4.5bn per year. This revenue will then be used to build affordable new property as part of a £1bn brownfield regeneration fund which aims to produce 400k new houses over 5 years, as well as fund the proposed discounts to tenants wishing to utlise the Right to Buy scheme.
Mr Fuller added: ‘The Government is giving the green light to all stakeholders to address the housing shortage, so it’s now down to developers, investors and local authorities alike to play their part in ensuring this happens.’
Vincent Courtney, Sales Managing Directed said: ‘Home building companies’ shares have soared. Five more years of stability and Conservative policies will give the sector the confidence to grow their operations and increase the housing supply in order to satisfy the demand.’
In the South East of England, a lot of new home developments are planned and with interest rates remaining at record breaking lows, it is likely that even the most cautious of investors will have the confidence to grow their portfolios. Following the 2010 general election, there was a 24.7 per cent increase in transactions nationally in the following 3 months, compared to the subsequent 3 months. It is likely that the increased stability that a Conservative majority brings for the next 5 years will result in an even bigger surge this time around.
In the region covered by Romans which includes Reading, Wokingham, Maidenhead, Basingstoke, Farnham, Farnborough and Camberley, there was a higher than average 26.5% increase in transactions following the 2010 election, and for homes worth £1m or more, this uplift amounted to 48 per cent. These figures would suggest that increased activity is likely over the next few months and beyond, and it would seem that whether you plan to buy, sell or rent, now is the time to act.
Mr Fuller commented added: ‘Understandably many people were uncertain and cautious in the lead up to the election but with stability assured, buyers, sellers, landlords and tenants will now have more confidence in the property market, supporting them in their next move.’
