Of the 70,510 households in Warrington, 21,192 homes are
owned without a mortgage and 27,731 homes are owned with a mortgage. Many
homeowners have made contact me with asking what the General Election will do
the Warrington property market.
The
best way to tell the future is to look at the past.
I have looked over the last five General Elections and
analysed in detail what happened to the property market on the lead up to and
afterwards. Some very interesting information has come to light.
Of the last five general elections (1997, 2001, 2005, 2010
and 2015), the two elections that weren’t certain were the last two (2010 with
the collation and 2015 with unexpected Tory majority). Therefore, I wanted to
compare what happened in 1997, 2001 and 2005 when Tony Blair was guaranteed to
be elected/re-elected VS the last knife edge uncertain votes of 2010 and 2015 –
especially in terms of the number of houses sold and the prices achieved.
Number of Houses Bought/Sold
Look
at the first graph below comparing the number of properties sold and the dates
of the General Elections.
It
is clear, looking at the number of monthly transactions (the blue line), there is a certain rhythm or seasonality to
the housing market. That seasonality hasn’t changed since 1995 – the periodic fluctuations that occur
regularly based on a season - i.e. you can see how the number of properties sold dips around Christmas,
rises in Spring and Summer and drops again at the end of the year).
To
remove that seasonality, I have introduced the red line. The red line is a 12
month ‘moving average’ trend line which enables us to look at the
‘de-seasonalised’ housing transaction numbers, whilst the yellow arrows denote
the times of the General Elections. It is clear to see that after the 1997,
2001 and 2005 elections, there was significant uplift in number of households
sold, whilst in 2010 and 2015, there was slight drop in house number of
properties sold.
Property
Prices
Next,
I wanted to consider what happened to property prices. In the graph below, I
have used that same 12 month average. Housing transactions numbers (in red) and
yellow arrows for the dates of the General Elections, but this time compared
that with what happened to property values (pink line).
It is quite clear none of the
General Elections had any effect on the property values. Also, the timescales between the calling of
the election and the date itself also means that any property buyer’s
indecisiveness and indecision before the election will have less of an impact
on the market.
Well,
as I have discussed in previous articles (and just as relevant for homeowners
as well) property value growth in Warrington will be more subdued in the coming
few years for reasons other than the General Election. The growth of rents has
taken a slight hit in the last few months as there has been a slight over
supply of rental property in Warrington, making it imperative that Warrington
landlords are realistic with their market rents.
In the long term, as the younger
generation still choose to rent rather than buy, investing in buy to let still looks a good bet – even with the changes in taxation.
If
you want to read more about the Warrington property market – then why not visit
the Warrington Property Market Blog for more information? You can always keep an eye on my blog for any
properties I feel will make a good buy to let opportunity, or if you are after
a second opinion then email over the property details or pop into my office for
a chat, or even find out how we can get the best out of your investment
property.
Email
me on manoj@hamletwarrington.co.uk or call
on 01925 235338. If you are in the area, feel free to pop into the office
– we are based on 6 Bankside, Crosfield St, WA1 1UP. There is plenty
of free parking and the kettle is always on.
Don't
forget to visit the links below to view back dated deals and Warrington
Property News.
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