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What Will Be The Effect Of A General Election On House Prices?

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In a years time or less we'll be voting for a (hopefully new) government.

What do you think the effect will be on house prices?

I'd welcome your thoughts and opinions.

I'm not sure myself, but I'd hazard a guess that the uncertainty of the resultant policies would tend to hold people back from a major purchase.

At any rate, it seems that whoever does win must quickly raise taxation by a huge amount in an attempt to balance the nations books.

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In a years time or less we'll be voting for a (hopefully new) government.

What do you think the effect will be on house prices?

I'd welcome your thoughts and opinions.

I'm not sure myself, but I'd hazard a guess that the uncertainty of the resultant policies would tend to hold people back from a major purchase.

At any rate, it seems that whoever does win must quickly raise taxation by a huge amount in an attempt to balance the nations books.

0% effect. They will slide regardless. This turd isn't polishable.

The country is fooked. Simple.

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Total guess, but here goes...

Tories in, short term sentiment bouncette, then back to sliding down as the inevitable cuts take effect. Then again, there's a lot that can happen between now and then when it comes to government spending (which is, let's face it, the only major thing that's still going strong in the economy right now) and, more importantly, how they finance it. If Labour are forced to come to terms with it before the election, things could be entirely different.

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The next election will be a trigger point in so much as after that the Tories (lets not kid ourselves that it will be anyone else) will have no option but to cut public services and put up taxes so we will all feel personally worse off, even if the recession is technically over by then (is this likely?). I personally don't see how this can have anything but a negative effect on the housing market.

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When the Tories won their nightmarish 4th term in 1992, I remember lots of press stories saying that house prices would start to rise again, now the threat of a labour govt had receded. They didn't. It will be the same this time when Labour lose - elections have little bearing on house prices (however, this situation is unprecedented and when the new govt come in and look at the books, the resultant policy decisions may well have an effect, probably via emergency taxes.) The effect would be a downwards one.

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Same as the 1990's as someone else said ... the realignment will continue until such time that unemployment stabalises, the banks books firm up and average prices are close to being back on track to where they should be.

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0% effect. ...

Yeah this gets my vote too.

Brown is a Thatcherite idiot just like Blair and Cameron will follow in exactly the same vein. The main fear is that Cameron is too scared to make the huge cuts in public spending needed to keep the economy together (he has promised to maintain New Labour spending - as Blair maintained Tory tax cuts) Since the Tories represent the vested interests of the rich and the rich are not really concerned about the value of mediocre real estate I doubt they (the Tories) have much of a view about the matter. If the new Tory government have the balls to cut public spending (as per Maggie and declare it a "price worth paying" to control inflation) then the market for housing will be diminished as millions of lower income people find the council will no longer subsidise their private sector landlords for sky high rents.

Either way round residential real estate will follow its long term trend price over the longer term....

Chris

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In a years time or less we'll be voting for a (hopefully new) government.

What do you think the effect will be on house prices?

I think the effect will be massive - but indirect - so subject to some sort of delay.

For the last 12 years, the treasury and cabinet have found it necessary to present consistently - in order not to undermine their (now precarious) position by contradicting what they previously said. A new government (even if it were to be another Labour government) would not have the same problem after an election.

I see the election as being a prerequisite to taking difficult decisions - and, looking objectively at the budget, our GDP, our balance of payments, our balance of trade, our inequitable tax system, our high burden of taxation on productive enterprise, our high cost of public projects (most of which under perform) etc. I can only see one sort of consequence for house prices when those tough decisions are made. At the moment, we're floating on near-zero interest rates... that's no fix - essentially it is merely delaying the day of reckoning - preventing good economic decisions from being made by tying up essential resources inappropriately.

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Brown is a Thatcherite idiot just like Blair and Cameron will follow in exactly the same vein. The main fear is that Cameron is too scared to make the huge cuts in public spending needed to keep the economy together (he has promised to maintain New Labour spending - as Blair maintained Tory tax cuts) Since the Tories represent the vested interests of the rich and the rich are not really concerned about the value of mediocre real estate I doubt they (the Tories) have much of a view about the matter. If the new Tory government have the balls to cut public spending (as per Maggie and declare it a "price worth paying" to control inflation) then the market for housing will be diminished as millions of lower income people find the council will no longer subsidise their private sector landlords for sky high rents.

:blink::huh::blink:

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......

I see the election as being a prerequisite to taking difficult decisions - and, looking objectively at the budget, our GDP, our balance of payments, our balance of trade, our inequitable tax system, our ...

blah blah blah....

As opposed to MPs who see it as an opportunity to take power from the 'other' bunch of crooks who have been fiddling their expense accounts...

Chris

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If house prices rose with inflation +2% per annum from 1996 till 2007, what would the Nationwide index been at?

Edited by Eiji

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If the Tories do the most politically sensible thing and go straight to the IMF (assuming Labour haven't prior to the election), economic sentiment may well be quite bleak post-election.

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I go with previous posters:

Mini-bounce from unwarranted optimism.

This will be followed by a fast slide caused by massive cuts in public spending leading to job losses in the public sector and dependent industries, such as construction, and rises in taxes.

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I go with previous posters:

Mini-bounce from unwarranted optimism.

This will be followed by a fast slide caused by massive cuts in public spending leading to job losses in the public sector and dependent industries, such as construction, and rises in taxes.

well, we are in the spring bounce, banks are still fooked, and lending is difficult, as it should be.

what will change next year?

more tax, higher interest rates, risen unemployment, PS culling or maybe even vouchers for their staff in liueu of pay?

yes the optimism, followed by pain and a new government in short order.

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The price of housing is negotiable, unlike the price of many essential items, which is fixed. So if inflation hits the price of food, fuel etc. while taxation and spending cuts reduce disposable income, you can't reduce what you spend on food but you can reduce what you offer on a house. That effect is only going to become dramatic if there is a significant increase in forced sellers (either through unemployment or rising IRs making mortgage payments impossible), but the decisions made (involuntarily) by an incoming government will certainly exert pressure in that direction.

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An election next year? If we do not get an election this year the last thing you will be thinking about is effing house prices.

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well, we are in the spring bounce, banks are still fooked, and lending is difficult, as it should be.

what will change next year?

more tax, higher interest rates, risen unemployment, PS culling or maybe even vouchers for their staff in liueu of pay?

yes the optimism, followed by pain and a new government in short order.

I liked it when I used to get Luncheon Vouchers, £1.15 a day.

Some of the hardened drinkers I used to work with in the City seriously thought they should receive part of their pay in beer vouchers (on the assumption there would be some discount and tax saving).

I'd be happy to get petrol and food vouchers if there was a tax saving.

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I liked it when I used to get Luncheon Vouchers, £1.15 a day.

Some of the hardened drinkers I used to work with in the City seriously thought they should receive part of their pay in beer vouchers (on the assumption there would be some discount and tax saving).

I'd be happy to get petrol and food vouchers if there was a tax saving.

sure you would, right up to the day when the supermarket says "no more" your employer couldnt afford the cash to pay you, and they certainly dont have the cash to recoup these vouchers.

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It's when the interest rates start to shoot up - that's when we'll see the true level of house prices.

True. Just wish i could see by when and how much, all of the hpc deniers i know say it won't happen and the are staying low for the long term - surely a decesion that will be out of the govt's hands with bonds etc.

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