While final election results are still being tallied this morning, Labour’s first Budget and fiscal update may not be presented until at least September, which is when significant political announcements are expected.
The impact on estate agency-specific issues such as regulation and recent parliamentary reviews into the homebuying and selling process remains uncertain. However, the Labour Party's election manifesto provides some clues for what agents might anticipate.
Starting April 2025, first-time buyers will see their Stamp Duty exemption reduced back to £300,000, and Labour has pledged to introduce a Freedom to Buy scheme.
Matt Thompson, head of sales at Chestertons, commented: “Labour’s decision to lower the Stamp Duty threshold for first-time buyers from £425,000 to £300,000 in April 2025 raises questions about whether they will introduce any major initiatives to facilitate entry onto the property ladder. Buyers will be looking for Labour to deliver on its Freedom to Buy promise but are worried that purchasing a first home remains challenging. Labour's plan to increase the already higher Stamp Duty rate on residential property purchases by non-UK residents by 1% is unlikely to significantly impact London's property market, as it continues to attract international professionals and investors who will simply adjust their budgets or look for property in different areas of the city.”
Another potential market influencer is the proposed addition of VAT to private school fees. Nigel Bishop of Recoco Property Search remarked: “This could make private schooling unaffordable for many parents, boosting demand for homes near good state schools. Properties in these catchment areas already command a 20% premium, and increased demand will further heighten competition.”
Despite this, some property professionals question whether parents would incur moving costs such as Stamp Duty and buying a new property just to save on school fees.
Propertymark emphasized the importance of prioritizing housing policy for the Labour Party as it enters Downing Street. The agency trade body called for a comprehensive review of how various demographics will be supported within the housing mix and stressed the need for fundamental planning to assist first-time buyers.
Nathan Emerson, chief executive of Propertymark, stated: “Propertymark looks forward to extensive engagement with the new Labour Government to guide a clear path for the housing sector. There has been a chronic undersupply of affordable new housing for years. Sustainable housing is essential for a strong economy, and there must be well-thought-out plans that encourage investment and improve supply. We seek long-term, cross-party cooperation to deliver the right types of homes where they are urgently needed.”
Agents agree that the market could become more active. Bishop added: “Leading up to the General Election, we saw house hunters who had paused their activity due to political uncertainty resume their search. With a party now elected and economists predicting a possible interest rate cut in the coming months, we expect even more buyers to return to the market."