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Post-Election Confidence Floods into UK Property Markets

Property markets around the country expected a rollercoaster ride during the first half of this election year. Concerns of Labour's 'mansion tax' stalled the luxury homes market and resulted in an international investment standoff as the country nervously awaited the post-election result on 8 May. Contrary to every opinion poll during the campaign, the Conservative Party quickly realised that they would once again occupy Parliament after the results of the exit poll hit our screens. As Labour's hopes dwindled, asset-rich owners across the country breathed a sigh of relief. Soon after, this relief galvanised into a rush of property activity to snap up more than £1bn worth of fresh property on the market. The true value of property The 2015 election has demonstrated the importance and influence of property assets in the larger UK economy. Property policies have not held such high importance than after the Second World War when Labour's Clement Attlee won the election on a promise to rebuild bombed streets across Britain. Understanding the importance of the industry, the Conservatives positioned themselves early as the party for homeowners with the introduction of a new stamp duty levy that benefitted a staggering 98% of property owners across the country. Lending to property companies has risen sharply to more than £45bn as property markets re-enter a boom while other asset classes fall by the wayside. Levels of margin and healthy capital growth are currently causing massive ripples in London property in particular that are hard to ignore. Even international investors, who will now be affected by the strong value of the pound, haven't been deterred from snapping up prime London property. Satisfied prime markets News of a Conservative majority was certainly music to the ears of those in prime property districts. It was calculated that 96% of those that would have been affected by a mansion tax were situated in London - this caused a temporary stall in the markets and a surge of new sellers prior to 7 May. The cautious climate followed by a boom of activity echoes the stages witnessed in the three months following the 2010 coalition result which underwent an average jump of 17% in the number of new sellers to the market. The majority result proved to be the confidence boost that reignited activity in the prime London market ' around £100 million changed hands on 8 May alone. A six-bed, £1.575m Battersea property, a £9.5m freehold house on Eccleston Square and a £2.75m Mews House nearby are just some examples of properties coming onto the market since the election. Examples of gazumping have also been recorded during this highly competitive window, including a renegotiated contract between a buyer and a vendor scrapped only for the property to be put back onto the market and sold the same evening. Maintaining a prosperous future Across the city, 26,000 homes were under construction in 2014. If London wants to maintain its position as a global property investment destination and continue buying and selling activity at its current level, housebuilding needs to increase to 50,000 per year. Now that market confidence has been restored, vast new developments can persist to bridge the gap. The two-kilometre Nine Elms District from Battersea Power Station to Vauxhall is just one regeneration project that will thrive without an impending mansion tax to blight its high-end housing stock. The 'back to business as usual' mentality will increase engagement inside emerging markets alongside prime stock. In April 2015, the Emerging Prime Index identified areas in the south west, such as Clapham and Battersea as ripe investment markets. As capital floods into London, prospective buyers will be seeking out gems outside central London before house prices increase into 2016. For many involved in the gradual development of the capital, the election result has maintained a level of confidence that is needed for growth. With Crossrail starting to pave its way underneath the city and the transformation of London landmarks and prime land still on course for completion, pre-election jitters seem to have almost drifted away.

Property markets around the country expected a rollercoaster ride during the first half of this election year. Concerns of Labour's 'mansion tax' stalled the luxury homes market and resulted in an international investment standoff as the country nervously awaited the post-election result on 8 May. Contrary to every opinion poll during the campaign, the Conservative Party quickly realised that they would once again occupy Parliament after the results of the exit poll hit our screens. As Labour's hopes dwindled, asset-rich owners across the country breathed a sigh of relief. Soon after, this relief galvanised into a rush of property activity to snap up more than £1bn worth of fresh property on the market.

London_pan

The true value of property

The 2015 election has demonstrated the importance and influence of property assets in the larger UK economy. Property policies have not held such high importance than after the Second World War when Labour's Clement Attlee won the election on a promise to rebuild bombed streets across Britain. Understanding the importance of the industry, the Conservatives positioned themselves early as the party for homeowners with the introduction of a new stamp duty levy that benefitted a staggering 98% of property owners across the country.

Lending to property companies has risen sharply to more than £45bn as property markets re-enter a boom while other asset classes fall by the wayside. Levels of margin and healthy capital growth are currently causing massive ripples in London property in particular that are hard to ignore. Even international investors, who will now be affected by the strong value of the pound, haven't been deterred from snapping up prime London property.

Satisfied prime markets

News of a Conservative majority was certainly music to the ears of those in prime property districts. It was calculated that 96% of those that would have been affected by a mansion tax were situated in London - this caused a temporary stall in the markets and a surge of new sellers prior to 7 May. The cautious climate followed by a boom of activity echoes the stages witnessed in the three months following the 2010 coalition result which underwent an average jump of 17% in the number of new sellers to the market.

The majority result proved to be the confidence boost that reignited activity in the prime London market ' around £100 million changed hands on 8 May alone. A six-bed, £1.575m Battersea property, a £9.5m freehold house on Eccleston Square and a £2.75m Mews House nearby are just some examples of properties coming onto the market since the election. Examples of gazumping have also been recorded during this highly competitive window, including a renegotiated contract between a buyer and a vendor scrapped only for the property to be put back onto the market and sold the same evening.

Maintaining a prosperous future

Across the city, 26,000 homes were under construction in 2014. If London wants to maintain its position as a global property investment destination and continue buying and selling activity at its current level, housebuilding needs to increase to 50,000 per year. Now that market confidence has been restored, vast new developments can persist to bridge the gap. The two-kilometre Nine Elms District from Battersea Power Station to Vauxhall is just one regeneration project that will thrive without an impending mansion tax to blight its high-end housing stock.

The 'back to business as usual' mentality will increase engagement inside emerging markets alongside prime stock. In April 2015, the Emerging Prime Index identified areas in the south west, such as Clapham and Battersea as ripe investment markets. As capital floods into London, prospective buyers will be seeking out gems outside central London before house prices increase into 2016.

For many involved in the gradual development of the capital, the election result has maintained a level of confidence that is needed for growth. With Crossrail starting to pave its way underneath the city and the transformation of London landmarks and prime land still on course for completion, pre-election jitters seem to have almost drifted away.

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