Confidence in housing market declines after election result

Consumer confidence in the housing market dipped in the days following the General Election, a survey has found.

Just over one in five (21%) people think now is a good time to buy a home, down from 29% in March, according to research from the Building Societies Association (BSA).

The survey took place four days after the election earlier in June resulted in a hung parliament.

Nearly a third (30%) of people in the survey disagree that now is a good time to buy a home - the highest figure since 37% of people felt this way in December 2008.

In June, 37% of people said they expect prices to rise over the next 12 months, down from nearly half (49%) in March.

Nearly a quarter (23%) said they expect prices to fall, up from 10% in March.

Paul Broadhead, head of mortgage policy at the BSA, said a similar dip in consumer confidence was seen after the vote to leave the EU last summer although the latest decline could only be temporary as by September 2016 confidence had largely bounced back.

He said: "Whilst the political effect may be short term, some of the underlying economic fundamentals are becoming more of a challenge."

Mr Broadhead said that with inflation picking up, consumers need to spend more just to maintain their current standard of living, posing a significant extra pressure for those who are saving for a deposit for a home.

He continued: "Mortgage rates, however, remain at historic lows and the market is highly competitive for those who do choose to purchase, whether for the first time or to move up the market."

More than 2,000 people took part in the survey.