Elections and Brexit weigh down UK real estate market

Elections and Brexit weigh down UK real estate market
Written by:
Damian Wood
19th November 2019
Updated: 11th March 2020
  • The upcoming elections and Brexit are weighing on the UK property market
  • The number of property listings has hit the lowest point in a decade
  • Prime Minister Boris Johnson remains positive that the market will correct soon after the elections and exiting the EU
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Property listings in the UK this year have seen the biggest fall ever since 2009, with analysts blaming it on the upcoming election and Brexit, according to a survey published on Monday.

According to property website, Rightmove, in the last four weeks to Nov. 9 alone, property listings dropped by 14.9% compared to the same period in 2018. The drop was the biggest in a decade.

“I’ve seen lots of unusual events affecting the property market in my 40-year career, but a Brexit deadline followed by a snap general election six weeks later is obviously a new combination,” Rightmove director Miles Shipside said.

In a bid to solve the deadlock over plans to exit from the European Union, Prime Minister Boris Johnson has called for a Dec. 12 election, but the deadline has been pushed to Jan. 31.

Among the things that are holding potential sellers from listing their assets is the issue of stamp duty tax imposed on all property transactions, with some waiting to see if the new government will reform it, leading to lower cost of listing and buying houses.

Rightmove’s research revealed that the cost of acquiring a house in the UK shot by 0.3% p.a. while home sales deals sealed reduced by 2.9%.

“Would-be sellers are not only faced with prices well below the peak of the boom but also the usual prospect of lower asking prices in the run-up to Christmas,” the report said. “On top of that, they now have to factor in the unique autumn combination of a Brexit deadline and a looming general election.”

Sources close to the prime minister told Aljazeera that he is expected to say in his speech at an annual conference of British business leaders that the Conversation party will deliver the Brexit and bring to end months of uncertainty that has been “weakening” the kingdom’s economy.

In the speech, Prime Minister Johnson is expected to say: “With a Conservative majority government you can be sure we will ‘Get Brexit Done’ and leave with the new deal that is already agreed – ending the uncertainty and confusion that has paralysed our economy.”

But in a separate survey, developers expressed their frustrations saying they were even more worried about the UK leasing market today than they were a couple of months ago. The number of developers who were pessimistic about the leasing market rose to 40% during the third quarter, up from 27% during the first quarter of this year.

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