Election wreaks “havoc” with DIY house sales
The May bank holiday weekend has historically been the busiest time of year for the FSBO or ‘DIY’ house sales market, but pre-election jitters have made a sizable dent in the expected figures. The House Shop predict house price increases after the election making the May Bank holiday ideal for buyers.
According to property website TheHouseShop.com, the bank holiday weekend consistently proved to be the busiest time of year for DIY sellers. Prior to their re-launch as The House Shop, the property site had made a name for itself in the UK FSBO market and were widely regarded as the oldest and largest private house sales site in the UK. Online since 2000, the company has a unique insight into a market that is sorely lacking the research material, data and statistics that can be easily found for other sectors of the housing market.
Looking at their own private listings data from the past 10 years, The House Shop claim that the May bank holiday weekend proved to be the perfect time for homeowners to begin marketing their properties. While activity in the estate agency market typically slows in months with more than one bank holiday, it seems that the combination of “Spring Cleaning Season”, the warmer weather and the added hours of the long weekend, causes a spike in FSBO listings.
The House Shop report that, despite the usual May bank holiday peak, both DIY sales activity and valuation leads for our estate agents in the run up to this weekend have significantly underperformed compared to previous years. Co-founder of The House Shop and property entrepreneur, Nick Marr, explained the drop in activity:
“Our history shows that this May bank holiday was the signal for homeowners to consider a property sale online. We can clearly see that vendor and valuation leads to our agents have steadily reduced, while advertisers looking at a peer-to-peer house sale have also declined. The Election is responsible for creating confusion and uncertainty. With homeowners unsure of the future, it is highly unlikely that we will not see DIY seller activity reaching anywhere near the peaks of previous years.”
“Our prediction for significant house price rises immediately after the election could well make this weekend the best time to buy the house you want. Pent up demand from buyers has been building up all year and the new wealthy silver landlords with access to pension pots entering the market will further push up prices.” – Nick Marr, Co-Founder, The House Shop
Pre-election jitters will always have an impact on levels of confidence and activity in the housing market, but this year the effect has been particularly acute. With spiralling prices in the capital and young peoples’ dreams of homeownership seeming further out of reach, housing has become a key battleground in the election campaign.
The messages on housing from politicians are complex, confusing, and quite often contradictory, making it nigh-on impossible for the public to gain any sense of confidence in the future of the market. For example, over this weekend alone, Ed Miliband announced 7 new housing policies, which included everything from the introduction of rent controls, to the abolition of Stamp Duty for First Time Buyers – and that is just one party, over one weekend.
Each of the main parties have taken strong stances on how to solve the housing crisis, and while some key goals are shared by all parties, there are also some significant differences. Owners of high-value homes, for example, will face drastically different fortunes depending on who comes into power. Labour’s proposed Mansion Tax will take an extra £3000 per year from homeowners of properties worth between £2 and £3 million, and even heftier levies will be applied to homes above that value. In contrast to this, a Conservative government in power come 8th May would give high-value homeowners a much better deal.
It is this permanent state of uncertainty that has been most damaging to housing market activity. Interestingly, almost half (46%) of NAEA member agents have seen the market cooling in the lead up to the General Election. With over a quarter (27%) of agents thinking the General Election will have the biggest impact on the housing market this year. So it seems that both the private sales and the estate agency markets are feeling the pre-election pinch.