The property market in London has experienced several months of cooling leading up to the General Election. This followed on from impressive growth in the first half of 2014 and led many people to claim that the property bubble was set to burst. Price rises across other parts of the UK did outpace London in this period, but a new forecast from CBRE claims that prices will increase in London by around 31% over the next five years. If this happens, the capital will reclaim its place as the UK’s property hotspot.
The property market always cools before a General Election as owners and buyers wait to see which party will come to power and what this will mean for them. This year the cooling has been more noticeable because it has followed on so quickly from a mini-boom. The timing of stamp duty changes also had an impact, as it encouraged people to purchase before new rates came into effect. This meant that many buyers and sellers had already concluded their business earlier than expected.
The new CBRE forecast claims that prices at both ends of the London property market will rise following the results of the election. The luxury market has been hit the most by the cooling, with the potential of a mansion tax coming into play, but will see prices rise by around 31% over the next five years. Mid-priced properties are expected to rise by a similar amount as demand returns and supply continues to be restricted.
The General Election is always a good time of the year for property investors to take a step back and consider their plans, particularly if they involve investing in London and the prime market. The results can have a big impact but the market in London has a remarkable ability to continue to thrive even in the worst circumstances, such as during the global financial crisis in 2008. Election upheaval has come and gone in the past and will do the same in the future too.
If you are taking this chance to reassess your investment strategy we would be happy to help you. Our knowledge of the market in the capital can be invaluable in helping you to make the right choices. From property management to purchases to council leasing in Lambeth and the rest of London, we offer a versatile and flexible property service.