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Historical Data Suggests Prices Rise by 5.4% in Post-Election UK Housing Markets

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    Could the General Election Destabilise the Property Market?

    The UK property investment market has shown promising signs of recovery in early 2024 after last year’s challenging market marred by higher mortgage rates and subdued growth. But with the surprise general election announcement, many in the property industry have been left wondering if political uncertainty may have a detrimental effect on the currently improving market.

    In order to get a clearer picture of election growth trends and see what we may be able to expect post-election, estate agent platform eXp UK analysed historical government house price data.

    They found that since the 1980s, house prices have increased by an average of 5.4% in the year that followed a general election, leading to increased confidence that this year’s election won’t change the market’s promising trajectory.

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      House Prices Increase Most Years Following a General Election

      In order to collect this data, eXp looked at house price growth in the years following the last ten general elections, starting in 1983. These figures were then adjusted for inflation to compare the market performance throughout the years.

      Not only did the research reveal an average yearly boost of 5.4% over the period looked at, but they also found that house prices had increased in the year after every general election with the exception of 1992 and 2010. These exceptions are explained by the fact that the elections took place during periods of recovery after recessions.

      After adjusting for inflation, eXp found that the highest rate of house price growth took place after the 1987 general election when Margaret Thatcher was elected for a third term. The lowest rate was recorded following the 2017 election won by Theresa May. The policies of the winning party may have some effect on buy-to-let 2024 and the best property investment types moving forward.

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      General Election Can Be ‘Time of Opportunity and Change’

      This analysis suggests that the current stability in the property market is not likely to be threatened by the general election this year. According to past elections, prices have grown by 4.6% on average following the election of a Conservative prime minister, while Labour wins have been followed by an average price growth of 10.9%.

      Adam Day, head of eXp UK, said: “Political uncertainty can be poisonous for the property market and we saw how years of back and forth over Brexit slowly put the market into a state of deep freeze.

      “However, a general election is unlikely to have the same impact and is often viewed by many as a time of opportunity and change, with historical figures showing that the housing market marches on regardless in the year that follows.

      “While we may see some buyers choose to sit tight in hopes of further housing market incentives, the upcoming election is unlikely to dent the positive momentum that has been building in recent weeks.”

      To find out more about the UK property market, take a look at our buy-to-let area guides covering topics such as investment property available in Exeter and investment property available in West Bromwich.

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      Author

      Jessica Ferris

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      Jessica Ferris is a property writer at RWinvest, helping our readers stay ahead of property market trends with the latest news and statistics.

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