After any General Election, there is a moment of uncertainty around any sector or industry. In this case, however, that uncertainty is amplified as we face a hung parliament, and all the instability that comes with it. Any result that goes against poll expectations such as this one results in a brief fall of the pound and questions about the future of the industry. Top figures have been examining the debris and opinions are now being fully formed as to what the future of the housing market is.
The housing market abhors uncertainty, and with the former housing minister, Gavin Barwell, losing his seat, there will be yet another new housing minister taking his place, the sixth minister in six years. Jackson-Stops & Staff chairman, Nick Leeming, believes that, regardless of what government or how it is formed, each main party manifesto should make housing a priority to help tackle the problems of supply, high transaction costs, and affordability, to bring some stability back to the market. On the other hand, sales director of Seven Capital, Andy Foote, believes that despite the changes of government the imbalance of supply and demand in the UK property market still persists.
Philip Woolner, Joint Manager Parter at Cheffins, warned that there would be clear ramifications for the hung parliament, but both the Conservatives and Labour parties are planning on measures for house delivery that would likely help address the affordability issues and chronic shortage of stock in the UK. However, mortgage lenders are confident that the storm will settle and that the uncertainty is mostly a short-term affair. Some are less than optimistic, however, believing that slowing house prices could even lead to a reverse. The Three D’s of the Housing Market, death, debt and divorce, will continue to drive supply but their numbers won’t be matched by buyers, leading to softening prices and potential price falls. Henry Pryor, a buying agent, says that this indicates a worrying time for anyone looking to sell, but potentially a good time for buyers.
Paresh Raja, CEO of MFS, believes that there is an “untapped potential of UK property investors in positively contributing to UK housing supply through short-term refurbishment projects,” and that the government needs to treat landlords and property investors more like entrepreneurs and recognise the role they play in the movement and stimulation of the residential property market. Tarlochan Garcha, CEO of Kuflink, recognises that the UK has gone through 15 Housing Ministers since 2000, and that there is an urgent need for stability by “building upon the existing policy foundations that were laid down in the 2017 Housing White Paper.” Fareed Nabir, CEO of LetBritain, sees a demand for greater stability just as Tarlochan does, and believes there must be a change in the rental system in order “to meet the requirements of a more urban, mobile and tech savvy tenant population.”
eMoov founder and CEO, Russell Quirk, has made comment on the situation now that the dust has settled. He worries that the return to normality for the housing market may be further away still as “political instability breeds procrastination on the part of homebuyers and sellers.” Considering the snap election and EU vote, we have seen this happening a lot recently and this looks set to continue. While the UK voter is developing electoral fatigue, so is the property market “until it’s re-awoken by something more politically and economically decisive than we have seen over the past 24 hours.” It seems likely that the housing market will not be on the immediate agenda due to the upcoming Brexit talks and the high potential for yet another general election, so the market will likely stay in its current situation until a more concrete foundation has arisen.