Will the elections affect house prices?
This year's general election could have a dampening effect on the housing market with many people likely to adopt a "wait and see" approach and delay making sale or purchase decisions until the election is over.
Property valuation and market analysis company Valocity has analysed property sales trends around the 2014 general election and compared them with trends in 2013 and 2014 to see if the last election had a noticeable impact on the market.
It found sales volumes nationwide were down an average 8% per month between the time when the date of the election was announced in March 2014 and it taking place in September that year, when compared to the same periods of 2013 and 2015.
The effect was even more pronounced in Auckland, with monthly sales down and average of 23% between the date when the election was announced and it being held.
Valocity Valuation Manager James Wilson said the drop in sales was clearly uncharacteristic when compared to sales patterns from the previous and following years and was likely caused by the market adopting a wait and see approach.
However the figures also showed that there was a sharp uplift in sales once the election was over and the outcome was known, and the upturn continued into the following year.
My own experience regarding elections since 1997 in the UK and 2002 in NZ is that yes the market goes quiet while everyone adopts a “wait and see” policy but it returns to normal when absolutely nothing changes when the results are in. I’m confident we won’t see a Trump shaped hole blowing away my prediction of the property status quo in 2017.
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