Will the July Election Impact London's Property Market? Here's What History Tells Us

Will the July Election Impact London's Property Market? Here's What History Tells Us

As an estate agent in London, you might be curious about how the upcoming general election on July 4th will affect the property market in the capital. Historically, house prices have risen by an average of 5.4% in the year following a general election, suggesting that the positive momentum we've been witnessing in recent months is likely to continue.

Historical Resilience of the Property Market

Last week, Prime Minister Rishi Sunak announced the election date, prompting speculation about potential impacts on the housing market. Despite political uncertainties, the market has shown resilience in 2024, with mortgage approvals rising for six consecutive months and house prices following suit. The stability provided by steady interest rates has been a key factor in this positive trend.

Short-Term Uncertainty vs. Long-Term Growth

However, the market isn't back to full strength yet, and election-related uncertainty could slow down activity temporarily. The good news, according to eXp UK's analysis of government house price data, is that general elections have not historically hurt house prices in the long term.

Analysis of Past Elections

eXp UK analysed the annual rate of house price growth in the year following the last 10 general elections since 1983, adjusting for inflation to provide a clear view of market performance. Their research shows that home sellers in London have little to worry about regarding an election-induced house price slump, with the average house price increasing by a respectable 5.4% on average following a general election.

Notable Exceptions

In fact, house prices have increased in the year following every general election since 1983, with only two exceptions: 1992 and 2010. These periods followed the early 1990s recession and the 2008-09 financial crisis, respectively.

Highest and Lowest Growth Rates

The highest rate of inflation-adjusted house price growth followed the general election of 1987, when Margaret Thatcher won her third term as Prime Minister. In contrast, the lowest rate of positive house price growth after an election came following Theresa May’s election in June 2017.

Party Influence on Market Stability

The analysis by eXp UK shows that regardless of which party takes power this time around, the market is likely to remain robust. Following the election of a Conservative Prime Minister over the last 10 elections, house prices have climbed by 4.6% on average, while this growth climbs to 10.9% in years following the election of a Labour Prime Minister.

Expert Commentary

Adam Day, Head of eXp UK, commented: “Political uncertainty can be poisonous for the property market, as we saw with the years of back and forth over Brexit. However, a general election is unlikely to have the same impact and is often viewed as a time of opportunity and change, with historical figures showing that the housing market marches on regardless in the year that follows.
"While we may see some buyers choose to sit tight in hopes of further housing market incentives, the upcoming election is unlikely to dent the positive momentum that has been building in recent weeks.”


For London estate agents, this historical context provides a reassuring outlook. The capital's property market has shown resilience through previous elections, and the current trends suggest that it will continue to thrive, providing ample opportunities for buyers, sellers, and investors alike.