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Elections and taxes – the impact on the property market

With the general election less than a month away in May 2015, speculation has already begun on which political party looks set to win. From a property investor’s perspective, the major concern surrounds the tax implications of a new administration coming into office.       The unsettling effect of an election on the property market   Evidence suggests that political instability makes buyers jittery, particularly as it becomes impossible to calculate the costs that will be involved in an investment. As the UK moves into a temporary period of governmental uncertainty, a slowdown in transaction volumes is anticipated as we move closer to polling day. In the run up to previous general elections, buyers have delayed purchasing until after the ballot papers have been counted and the new government has taken office. Despite the slowdown in transaction levels prior to an election, in every election since 1997 the increase in properties sold in the three months after the election has exceeded what we would expect from the long run average for a non-election year (1995 – 2013). In the years when a May election was held (1997, 2005 and 2007), the number of sales in the three months post-election (June to August) increased by between 20.0% and 24.8% compared with the previous three months. There is, of course, some seasonality involved in creating this trend. However, all these figures exceed the usual increase of 15.9% experienced over the same period in non-election years. In 2001, when the election took place in June, the increase in transactions post-election also outperformed the long run average, with an increase in sales of 11.7% in the three months post-election compared with growth of 8.9% in non-election years. Uncertainty affects everybody and property investors are no different in this regard. With just weeks of political posturing left, there is no doubt that many people with a vested interest in the property market will be keen for the election to come around sooner rather than later to allow investors to be able to clearly plan ahead. For more information about the election and the housing policies proposed by the different political parties, click here. To book an appointment with one of our experts if you're looking to buy, sell, rent or let, then click here.

With the general election less than a month away in May 2015, speculation has already begun on which political party looks set to win. From a property investor’s perspective, the major concern surrounds the tax implications of a new administration coming into office.     Winkworth Blog Aug_v5_EngWales

  The unsettling effect of an election on the property market   Evidence suggests that political instability makes buyers jittery, particularly as it becomes impossible to calculate the costs that will be involved in an investment. As the UK moves into a temporary period of governmental uncertainty, a slowdown in transaction volumes is anticipated as we move closer to polling day. In the run up to previous general elections, buyers have delayed purchasing until after the ballot papers have been counted and the new government has taken office.

Despite the slowdown in transaction levels prior to an election, in every election since 1997 the increase in properties sold in the three months after the election has exceeded what we would expect from the long run average for a non-election year (1995 – 2013).

In the years when a May election was held (1997, 2005 and 2007), the number of sales in the three months post-election (June to August) increased by between 20.0% and 24.8% compared with the previous three months. There is, of course, some seasonality involved in creating this trend. However, all these figures exceed the usual increase of 15.9% experienced over the same period in non-election years. In 2001, when the election took place in June, the increase in transactions post-election also outperformed the long run average, with an increase in sales of 11.7% in the three months post-election compared with growth of 8.9% in non-election years.

Uncertainty affects everybody and property investors are no different in this regard. With just weeks of political posturing left, there is no doubt that many people with a vested interest in the property market will be keen for the election to come around sooner rather than later to allow investors to be able to clearly plan ahead.
For more information about the election and the housing policies proposed by the different political parties, click here. To book an appointment with one of our experts if you're looking to buy, sell, rent or let, then click here.

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Elections and taxes – the impact on the property market

With the general election less than a month away in May 2015, speculation has already begun on which political party looks set to win. From a property investor’s perspective, the major concern surrounds the tax implications of a new administration coming into office.       The unsettling effect of an election on the property market   Evidence suggests that political instability makes buyers jittery,...

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August 28, 2014

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