NOW PRIME MINISTER, WE MUST TALK ABOUT HOUSING…

It may be too early to predict accurately what effect last week's General Election will have, but it seems clear that change is in the air, writes Clive Hedges.

It has been striking during this campaign how little the property market has been affected.  Usually uncertainty about the political situation leads to a dip – temporarily at least – in confidence, and the market pauses until the situation is clear.  But no such slowdown has happened this time around: In April, May and June my branch’s sales were all ahead of targets which were set well before Rishi Sunak’s rather damp announcement of a July General Election.

Partly this is because in many people’s minds, the actual result of the poll was clear from the start.  It is uncertainty which damages confidence.  If people feel certain about the outcome, they will not put plans on hold.  For much of the campaign the debate was not about who will win, but about the margin of victory.

Another reason for continued confidence is that Labour had nothing in its manifesto which will scare the markets.  Of course, election promises and what politicians actually do often diverge, but there is little to frighten the horses from either side.

As Keir Starmer settles into 10 Downing Street, housing will be one of his early priorities. 

Labour has promised reform of the planning process as part of a pledge to deliver many more new homes – affordable homes included – and if they are successful in delivering this, it will be just what the market needs.  A long-term mismatch between supply and demand continues to skew the market.  Providing stability and sustainability will require a rebalancing which can only be achieved through building many more new homes.

The new government will be helped by the prospect of lower interest rates across the summer and autumn, which will help affordability for first-time buyers in particular.

For a government with economic growth at the centre of its plans, housing is key.  The housing crisis is a considerable constraining factor on growth itself, and solving that crisis is a big factor in delivering that promised growth.  So housing must be an early priority of the new government.