The Impact of Labour’s Election Win On Property

Let’s dive straight in and explore how Labour’s policies and pledges could positively impact the property market:

Boosting Market Confidence and Lowering Interest Rates

The overwhelming majority achieved by Labour in the election has already created a sense of political stability and solidarity. This confidence created by such an overwhelming mandate for change is crucial for the property market. According to CNBC, this stability is expected to boost market confidence, which, in turn, could lead to lower interest rates. Making borrowing cheaper, and providing a more favorable environment for property investment and development.

Investor Confidence

For property investors, both in the UK and internationally, the possibility of lower borrowing costs presents an excellent opportunity to expand portfolios. The proposed stamp duty land tax increase of 1% for international investors is a relatively small adjustment that is unlikely to deter investment, especially given the broader economic benefits and growth potential under Labour’s policies.

Developers and Landowners 

Landowners and developers could find Labour’s infrastructure and housing plans particularly encouraging and enticing. Increased government investment in public infrastructure and housing projects means more opportunities for land acquisition and development, whilst the commitment to reducing red tape in the planning process and backing for brown and greyfield land development might see development accelerate more swiftly under a new Labour government. 

Developers can hope to see a surge in demand for new housing projects, particularly in underdeveloped regions benefiting from enhanced infrastructure. Based on the Labour foundations of “securonomics” organisations across the residential property sector could see more visibility of long term planning with access to broader funding as local authorities have a greater impact on the shape of housebuilding in their communities.

Expanding Affordable Housing

Labour’s commitment to building affordable homes addresses one of the most pressing issues in the UK property market: the housing shortage. By pledging to construct 1.5 million new homes and refurbish existing properties, they aim to provide more affordable housing options, which will benefit those looking to take their first step on the property ladder.

First-Time Buyers and Homeowners

For first-time buyers and existing homeowners, the proposed housing policies could be a welcome development. The increased supply of affordable homes could help stabilise property prices, making homeownership more accessible to first-time buyers that could perhaps previously not afford to purchase their first home and enabling the market to grow. Additionally, homeowners can expect their property values to appreciate steadily due to improved market stability and infrastructure enhancements – it’s important to note that this growth is predicated on a strong market reaction to the overwhelming Labour majority – the mandate that the UK has given to Sir Kier Starmer and the Labour party at the election could signal confidence to the financial markets, which in turn will have an impact of everything from interest and mortgage rates to the availability of development funding and beyond. 

Renters 

Renters, too, stand to benefit from Labour’s housing initiatives. With a greater supply of affordable rental properties, tenants could expect more competitive rental prices and better living conditions. This shift alongside the prioritisation of new social rented homes could lead to longer-term tenancies and more secure rental arrangements, contributing to overall market stability. In addition to this, the abolition of Section 21, which was a key pledge in the Labour manifesto – should help to foster a greater sense of security for tenants across the UK. Landlords will be waiting to understand the impact of the incoming Labour government on important issues including Leasehold Reform and the Decent Homes Standard as well as compliance and sustainability updates. 

Fostering Sustainable Development

Sustainability is at the heart of Labour’s economic agenda. Their commitment to green construction and energy-efficient buildings is aligned with the global drive towards sustainability. Whilst a number of measures are already in place and green building regulation is not a new initiative an increased focus will be viewed as both an opportunity and a challenge across the industry. If you’d like to find out more about Sustainable and Green Building Regulations check out the blog. 

Green Investment Opportunities

For investors focused on sustainability, Labour’s green initiatives present numerous opportunities. Investments in renewable energy projects, green infrastructure, and energy-efficient housing will not only contribute to environmental goals but also promise attractive returns as demand for sustainable properties grows. At Centrick Invest our research has always shown a growing propensity for environmentally friendly homes and our development due diligence reflects this want from residents and homeowners alike. 

Property Developers and Landowners

Property developers and landowners could also leverage Labour’s green agenda to enhance their projects. By incorporating sustainable practices and technologies, developers can meet the increasing demand for eco-friendly properties, positioning themselves as leaders in the evolving market. Our latest research has identified sustainability as one of the most sought after features from tenants across the UK, and as the drive to become more green increases, we expect the demand for greener properties to continue to rise. 

Regional Development and Infrastructure

Labour’s focus on regional development ensures that economic benefits are spread more evenly across the UK, creating new opportunities in previously overlooked areas.

Regional Investors and Developers 

Labour’s plans to invest in transportation, digital connectivity, and public services will make these regions that may have previously been overlooked, become more attractive for development, driving up property values and investment potential and opportunities for both investors and developers.

Local Communities

Local communities will also benefit from Labour’s regional focus. Improved infrastructure and increased investment will lead to job creation and economic revitalisation, enhancing the quality of life and making these areas more desirable for both living and investment.

What next for Property Investment, Land and New Homes? 

A change in UK government sets the stage for a dynamic and positive future for the property market. With a focus on stability, growth, sustainability, and regional development, Labour’s policies promise to create a more robust and equitable property market. 

Whether you are an investor, developer, homeowner, first-time buyer, or renter, the coming years under Labour’s governance offer numerous opportunities and benefits. 

Our team of experts will be sharing their thoughts and discussing the outcome of the UK general election in our live webinar on Thursday 11th July. Register today to find out more about how the election result may impact the property market: