After the results of the general election were announced and Boris Johnson´s success was confirmed, the UK markets skyrocketed and the positive outlook on the property market´s future boomed along with them.
Michael Stone, CEO of Stone Real Estates, stated his expert opinion that we would see an immediate increase in house prices under a Conservative government. He said: “We can expect a market bounce from the get-go in 2020, not only where housing supply is concerned, but with a notable increase in buyer demand levels as well”.
It is widely assumed that high levels of ambiguity surrounding Brexit have long since been the source of the struggles in Britain´s property market.
However, a landslide win for the Conservative Party paves the way for a confirmed Brexit deal, one that will be supported by MPs therefore increasing the probability that the UK´s departure date from the European Union will be on January 31, as planned. This will create a positive knock-on effect, ensuring a more stable and profitable housing market.
The prime minister´s win also means that foreign investors who have recently been deterred from the British property market no longer have uncertainty or price falls to fear. It is also likely that the UK will see an influx of new builds now the country´s future is more certain, a boost that overseas investors should be interested in since the sector has recently shown low stock and stagnant growth.
But that´s not it for the positive changes. Yesterday at market close, a Conservative win seemed imminent and sterling´s exchange rates followed suit. The pound to dollar strengthened by 2.10 per cent to 1.347 – the highest level since May 2018 – and the pound to euro also rose by 1.79 per cent to 1.206: a three and a half year high.
Shares that are heavily influenced by political moves have experienced sharp rises in early trading on UK markets. Water companies like Severn Trent, which faced the possibility of nationalisation under a Labour government, grew by 10 per cent. UK housebuilders also received huge gains with a colossal 14 per cent rise for Persimmon.
British banks saw their shares shoot up, with Barclays, RBS and Lloyds increasing by 7 per cent, 12 per cent and 15 per cent, respectively.