General election could affect housing market momentum

Countrywide Countrywide, the UK’s largest property group has warned that the housing market could experience a ‘sluggish’ period in the run up to the general election.

With the UK’s political leaders’ battle for votes well underway, Countrywide’s chief executive, Alison Platt, has warned that the housing market is ‘holding its breath’. With nationwide uncertainty over the outcome of the forthcoming general election in May Countrywide believes that many people are taking a ‘wait and see’ attitude and this is causing the housing market to remain flat.

Countrywide executives, who have recently released their latest financial statement, reported significant profits for last year resulting from shrewd business strategies and a buoyant market in the first half of 2014. In contrast 2015 has seen a drastic shift in the market and many industry experts have attributed this to political uncertainty. Some have predicted that a hung parliament is likely to be the least favourable option for the housing market and the economy as a whole.

Platt eches this sentiment stating that ‘its going to be tough in the walk-up to the election and clarity is the best we can hope for.”

So what exactly are the key political parties proposals with relation to the housing market? According to the BBC’s Manifesto Watch, the Lib Dems, Labour, the Greens and the Conservaties all have specific house building targets with the Greens specifying a focus on building social rented homes. The conservatives plan to introduce a policy to reduce purchase costs for first time buyers under 40 and Labour want to cap rent increases in the private rental sector.

Conservatives: First-time buyers in England under the age of 40 would be able to buy a house at 20% below the market rate, with 100,000 starter homes to be built for them.

Labour: Build 200,000 houses a year by 2020, including new towns and garden cities. Cap rent increases in the private sector and scrap letting fees to estate agents to give a “fairer deal” to tenants. Greater powers for councils to reduce the number of empty homes.

Lib Dems: Build 300,000 houses a year, with up to five new garden cities in Cambridgeshire, Bedfordshire, Buckinghamshire and Oxfordshire.

SNP: Oppose the so-called “bedroom tax”. Provide support from the Scottish government to contribute to the building of new homes.

Plaid Cymru: Oppose the ‘bedroom tax’. Introduce stricter rent controls. Insist on written tenancy agreements.

UKIP: Protect greenbelt land by incentivising the building of affordable homes on brownfield sites. Establish a UK Brownfield Agency to hand out grants, tax breaks and low interest loans. Major planning decisions to be ratified by local referendum.

Greens: Abolish right to buy. Give councils the power to borrow money to build houses or buy them on the open market. Introduce a rent cap to prevent exploitation by private landlords. Set up a living rent commission, to work out how to bring rents back in line with incomes. Home owners unable to meet mortgage payments or under threat of repossession would get right to transfer ownership to the council, at less than market value, and pay rent as council tenants. Build 500,000 social rented homes by 2020, paid for by scrapping the buy-to-let mortgage interest tax allowance.

Source: BBC 5/3/2015

Posted by: Nicola Severn Categories: Economy, Latest News, Property News Tags: , , , , , Comments Off on General election could affect housing market momentum

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