One of the big stories amongst estate agents in 2024 is the astonishing resilience of house prices, but could this relative stability be tested by the upheaval and chaos that ensues in the wake of a general election?
With the House Price Index for June in the wake of the 2024 General Election showing a fall of just £21 in the average house price after a record high May, it appears that the effect on buyers and sellers is either minimal or affects the market in ways that cancel each other out when viewed as a whole.
Buyers late in the process become very keen to close the sale before Election Day itself and get themselves securely into their new home, whilst buyers early in the process will typically prefer to wait and see what the immediate aftermath of the election holds.
Historically, data collected by Nationwide and published by The Independent has found that house prices since the 2005 General election have risen in the first six months after a General Election, regardless of the winning party.
The only exceptions to this come in cases where no party has an overall majority, as happened in 2010 and 2017, where the housing market can sometimes react to the overall chaos until stability is restored in some form, or in 2019 where a shutdown of the housing market stopped sales entirely but led to an unprecedented surge in sales.
In 2010, a coalition government was formed and struggled to turn around house prices, but the additional context of the global financial crisis precipitated by a housing bubble also had an effect on prices as well that must be kept in mind.
Instead, there is often a post-election bounce inspired by a generally optimistic mood, something that is most acutely felt in house prices and often lasts for several months.
