The so-called Boris bounce in the property market after the last General Election failed to deliver, according to exclusive research for leading estate agents Winkworth.
Research by leading analysts Dataloft, commissioned by Winkworth, looked at price changes before and after the six General Elections since May 1997. In the three months before the December 2019 election, prices increased across the UK by 4.2%. Three months after the election, the price increase was just 0.7% and in prime central London, the change in price growth was -9.4%. Prices rose by almost the same percentage in advance of Tony Blair’s win in 1997, as before Boris Johnson’s victory in 2019.
Only in the 2005, 2010 and 2017 elections did the price growth surpass the preceding period. In the remaining four elections, prices continued to grow in the three months post-election, but at a lower rate.
Pre-election uncertainty has a short-term impact, according to the research, slowing the number of sales in the three to four months before voting day. This pattern holds true for six out of the last seven elections. Once the election result is known, the increased certainty over the political landscape and policies will normally allow the markets to pick up momentum again.
Dataloft’s report states: “Waiting to put a property on the market after an election, with the hope of achieving a much higher price, could be a risky strategy.” According to the research, it takes 10 days less to sell a home in spring than in winter. Over the past five years, excluding 2020 due to Covid, 27 per cent of sales took place in spring, the highest of any of the seasons.
Winkworth’s Chief Executive Dominic Agace, speaking on Winkworth’s Property Exchange podcast: said: “The biggest house price growth came when Blair was in power. We saw a rise of £48 a day on the average property price, which is contrary to popular belief that the Thatcher era saw the biggest growth due to Right to Buy.”
The effect of a General Election is to distract people in the three months leading up to polling day. Dominic Agace told the podcast: “Politicians are pushing policies to win votes and the politics can be more extreme than the reality of what happens once a party is in power. In 2019, there was a binary choice between Corbyn and Johnson. From a property perspective, housebuilders would probably prefer to see a Labour government [in this election] – that must be a first.”
Aaron Strutt, of Trinity Financial, said the effects of higher interest rates over the past year are still being felt. He told the podcast: “People who are coming to the end of very cheap deals and are now remortgaging are still feeling the pinch. They are having to make difficult decisions, taking their children out of private school, selling their homes and downsizing. Mortgage rates have gotten cheaper, and our advice is to secure rates now.”
