Industry leaders give their say on what a Labour government could mean for property

A new era has begun in British politics, with Labour sweeping to power after 14 years of Conservative leadership. 

Labour ran on a manifesto promising growth, economic stability, and policies focused on developing ‘grey belt’ land and building 1.5 million new homes.

With the changing of the guard in place, many leading industry figures have given their thoughts on what a Labour government could mean for both commercial and residential property.

Here, the BloomSmith team looks to give a flavour of what the sector anticipates will happen over the coming months and years.

Industry leaders have their say

As one of the UK’s leading estate services companies, Savills has been quick to give its thoughts on what the incoming Labour government could mean for commercial property.

In a brief opinion piece, they said: “With the results now in, the time for optimistic promises is over and the real work begins for the new Government.

“From a property point of view the pre-election period was a typical one, with a heavy manifesto focus on housing and limited attention to commercial property other than a handful of comments on the business rates regime.

“However, what commercial property investors and occupiers need from the new Labour Government is pretty simple: stability and the environment in which to focus on growth.

“The Labour Party’s manifesto may have been titled ‘change’, and for many who voted for them the prospect of a break from the past 14 years has proved to be political catnip, however, for those planning medium to long-term real-estate decisions then boring may well be the best option.”

In anticipation of the Labour victory, Zoopla’s Richard Donnell said: “If Labour win a big majority, as looks likely, it may well give a boost to the overall market sentiment as the two main parties aren’t miles apart in many areas.

“There will be a base rate cut at some point which will do more for market confidence than the election itself, and if this came in quick succession it could support sentiment and sales volumes which are on track for a 10% uplift in 2024.”

Chris Beauchamp, Chief Market Analyst at IG said: “Investors widely predicted a new Labour government, and have responded with expected calm.

“The size of Labour’s majority could help provide stability to support the UK economy, at a time when political uncertainty continues across other major developed economies, notably the US and France, which may present the UK economy as a relatively ‘political safe haven’ for overseas investors.

“Investors can cross ‘UK political risk’ off their list of worries for the time being.”

Nathan Emerson, chief executive of Propertymark, said: “Propertymark welcomes wide-ranging engagement with the new Labour Government to help steer an objective pathway forward for the housing sector.

“We have seen a chronic undersupply of affordable new housing for many years.

“Sustainable housing is the foundation for any strong economy and there must be clear and well thought out plans that inspire investment and improve supply moving forwards.

“We want to see long-term cross-party cooperation that delivers the right kind of homes in areas they are desperately needed.”

Final thoughts

A lot of hard work has already been done to get inflation under control, and growth has returned during the beginning of 2024, with the economy growing by 0.7% over the first three months.

With interest rates expected to finally drop in the coming months, a steady hand on the tiller is essential for a sector that has taken a hammering over recent years.

After a long six-week campaign, it is now time to see if Labour can deliver a stable environment in which the British real estate sector can rebound.