There are 50,106 households in Colchester. Of those, 13,421 homes are owned outright (without a mortgage), and 16,834 homes are owned with a mortgage. I’ve been asked by landlords and friends how I think the timing and outcome of the general election will affect the Colchester property market so here’s my analysis…
Often the best way to predict the future is to look at the past so I’ve looked at the last five general elections and analysed in detail what happened to the property market leading up to, and beyond, each general election with some interesting results.
I wanted to compare what happened in the 1997, 2001 and 2005 elections, when Tony Blair was guaranteed to be elected or re-elected, with the last two elections where the results were uncertain (the 2010 election resulted in the Tory Lib-Dem coalition and the 2015 election produced the unexpected Tory majority) in terms of the number of houses sold and the prices achieved. The graph below shows the number of properties sold each month with the date of each general election highlighted (by the yellow arrows) so you can see the trend before and after each election.
UK Monthly Housing Transactions Since 1995
Looking at the number of monthly transactions (the blue line) you can clearly see the “seasonality” of the housing market, with a drop each year around Christmas, followed by a rise each Spring which lasts through the Summer before dropping again towards the end of each year. The red line shows the “de-seasonalised” number of housing transactions as a twelve month “moving average” trend.
First of all let’s look at the number of properties sold after each general election. Notice the red line slopes sharply upwards after the 1997, 2001 and 2005 general elections indicating a significant increase in number of households sold after each general election. However, after the 2010 and 2015 general elections you’ll notice a slight drop in the number of properties sold.
Next, let’s take a look at what happened to property prices after each general election. In the graph below there’s the same red line as shown in the graph above (showing the twelve month “moving average”), the same yellow arrows (showing the dates of the general elections) with the addition of property values (that’s the pink line).
You can clearly see the pink property values line remains unaffected by general election results. Furthermore the time between calling an election and election day doesn’t significantly affect property values either. In conclusion the short answer to “how will the general election affect the Colchester property market?” is: “It won’t”.
What Does The General Election Mean For Colchester Landlords & Homeowners?
As I discussed in my recent Colchester property market overview, and in other recent articles, growth in Colchester property values is likely to remain subdued over the next few years. However none of those reasons are directly related to the timing of a general election. In the longer term the younger generation are still more likely to rent than buy so the prospects, even with the changes in taxation, remain good for buy-to-let investments.
One great way to stay on top of the latest developments in the UK property market in general and the Colchester property market in detail is to subscribe to my free newsletter. Alternative you can give me a ring on 01206 862288 to discuss any aspect of the Colchester property market. If you’d like my free honest opinion on local properties email the Rightmove or Zoopla links to firstname.lastname@example.org and I’ll get back to you, often within 24 hours.
Whichever Colchester general election candidate you decide to vote for on Thursday 8th June 2017 you can do so in the knowledge it’s unlikely to make any significant difference to Colchester property prices! Feel free to add your comments below…