How does a general election affect the housing market?

House transactions tend to ease off in the build up to a general election, as buyers and sellers wait to see the outcome before making a decision.

Spring also tends to be a busy period for the UK housing market, with sales climbing from February through to June.
The table below shows the number of property transactions that took place in the UK between 2009 – 2016. Election years are highlighted in red (according the Land Registry data).

 

  February March April May June
2009 33,218 43,308 47,263 54,185 62,613
2010 49,016 59,715 61,352 60,892 72,734
2011 45,807 54,489 59,194 57,436 67,035
2012 52,219 71,571 52,181 61,896 70,666
2013 54,216 66,119 62,585 80,067 80,094
2014 79,868 84,028 88,332 97,353 100,789
2015 72,056 83,114 81,006 92,437 103,794
2016 79,466 134,364* 58,863 64,315 74,096

*March 2016 transactions were affected by the changes in stamp duty for buy-to-let investors/second home owners

The data shows that transaction levels slumped just before the 2010 election on 8 June and 2015 election on May 7.

While the run up to an election often has some effect on how many houses are sold, it is not usually particularly significant as can be seen by the transactions recovering to the expected level in June 2015.
 

What will happen to property prices?

As the table below shows, it is unlikely that property prices will be affected. As can be seen ahead of the election in 2015, average property prices in the UK increased steadily in line with 2014 and 2016 levels.

 

  February March April May June
2014 £178,921 £179,537 £183,532 £185,476 £187,077
2015 £190,827 £191,537 £193,225 £195,313 £196,802
2016 £205,584 £207,333 £208,705 £212,191 £215,182

 

 

 

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