What will Brexit mean for house prices?
The Conservatives have won a landslide majority in the 2019 general election after the party swept aside Labour in its traditional heartlands.
After his election win, Prime Minister Boris Johnson has renewed his vow to take Britain out of the EU on January 31.
But what does this result mean for your property? And will it push house prices up?
Here’s what you need to know.
Return to confidence
Boris Johnson’s landslide win could mean there will be more stability in the housing market, with home owners set to benefit from the result – at least in the short term.
Brexit as well as the political uncertainty around it in the UK have been driving prices down with potential buyers and sellers waiting for the situation to become clearer.
But the result of the general election will not only end the political uncertainty, but it will also offer more clarity on when the UK is likely to leave the EU.
Property experts now expect those who have been holding off to go back to doing deals potentially driving house prices up.
“Expect a sharp uplift in transaction levels starting early in 2020, as buyers and sellers who have played it safe put their plans into motion,“ said Andrew Montlake, managing director of mortgage broker Coreco, adding that a ”huge amount“ of pent-up demand out there looks set to be unleashed on the market next year.
“Although a lot of the hard work around Brexit has yet to be done, there is now a political stability that will give a lot of people the confidence to get on with their lives,“ Mr Montlake said.
His views were echoed by former residential chairman of the Royal Institution of Chartered Surveyors, Jeremy Leaf, who said: “The most important thing for the housing market is that the result brings some stability, albeit short-term at least until we see a clearer timetable for Brexit.
“This should generate a return of confidence to the market, which is what we have been looking for.”
The long-term impact of Brexit remains to be seen
The end of uncertainty also means prices are likely to grow next year.
However, it remains unclear what will happen when the transition period finishes at the end of next year or what the long-term impact of Brexit will be on the UK economy.
Jonathan Samuels, CEO of the property lender, Octane Capital, said: “Price growth in 2020 is likely to be a lot more robust than in recent years but what we don’t want is for values to suddenly get ahead of themselves.
“The property market will enter 2020 with a spring in its step but all eyes will be on how the economy holds up as we exit the EU.”
What does it mean for first-time buyers
Some of the Conservative Party commitments is good news for inspiring first buyers. Boris Johnson has previously emphasised his party’s support for home ownership and their focus on helping first-time buyers
The party’s election promises included creating one million home of all types in the next five years, a review of the Help to Buy equity loan and “simplified” shared ownership.
However, the new target is below the party’s previous goal of 300,000 homes a year and property experts said the government should move toward increasing the supply of homes rapidly.
According to Richard Donnell, research director at Zoopla, the growth in new housing supply over the last five years has been boosted by the Help to Buy equity loan scheme which supports almost two in every five sales in England.
He said: “The scheme is due to end entirely in Spring 2023. This may seem a long way into the future, but our analysis suggests almost a quarter of schemes being developed today will still be under construction in 2023.
“There is the prospect of a cliff edge at this time, which could disrupt new housing supply. It is important the new Government focuses on transitioning from Help to Buy to a new scheme, modelled around the old Starter Homes scheme as outlined in the manifesto.”