Posted: 9th July 2024

Sellers Face Changes Following Election Results

If you’re already in the process of trying to sell your property, or it’s on your imminent to-do list, then the fact that the general election is finally done and dusted will be a relief. July 4 saw Labour take power with a landslide victory after 14 years of Conservative rule.

But your big question now will be how will the new Labour government impact your property sale?

Greater political and economic certainty

Although the date of the general election came as a surprise when it was announced only a few weeks ago, it ended the uncertainty of when it would be called. Now it’s done, it means that Labour can focus on the pledges made in its manifesto and start putting those plans into action, particularly around one of the biggest issues of the election – the cost of living.

The Conservatives have left behind a recovering economy after the UK hit its 2% target for inflation in June. It will be down to Labour to continue that work. A cut in the base rate, which is believed to be imminent, will reduce interest rates with mortgage rate falls hopefully then following. That will open up greater demand as more buyers come to market.

A rebalancing of supply and demand with the promise of new housing 

In the run-up to the election both Labour and Conservatives committed to the building of additional homes, with Labour pledging to reform planning laws to do so. Labour put a 1.5 million figure to its pledge. Ultimately this will mean more stock on the market and a rebalancing of supply and demand. But the timescales of new builds mean that this new stock will be some way off yet.  So, for the time being at least, your competition will come more from existing properties on the market rather than the new builds of the future.

Mortgage help

In a bid to increase affordability, both the Conservatives and Labour made bold pledges to address the inaccessibility of the mortgage market for those for whom affordability is an issue. Labour has pledged to introduce a permanent and comprehensive mortgage guarantee scheme called Freedom to Buy. This will offer additional support for first-time buyers struggling to save for their deposit.

This, alongside lower mortgage costs, should open up the market to more first-time buyers which will be good news if your property is a suitable first home. However, this will take time to implement so is no quick fix. In the meantime, Labour confirmed at the beginning of July that it would reduce the first-time buyer stamp duty exemption to its previous £300,000 level. It had been raised to £425,000 in September 2022 with an April 2025 reversal previously pledged by the Conservatives. This could dampen demand for properties that exceed that threshold.

In conclusion

The reality is that none of Labour’s proposed changes that impact the housing market will be immediate. Instead, the biggest impact on your sale is likely to come from how the economy performs in the coming weeks and whether base rate cuts, and subsequently mortgage rate cuts, finally become a reality to stimulate greater buyer demand. Improved market stability, with the removal of the uncertainty that has plagued the sector for so long, should also have a positive impact.

For more information on how we can assist you on your sales journey, please contact one of our branches in Seaford, Peacehaven, and Newhaven areas. If you would like further guidance on any part of the sales process, get in touch with us today.

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