The outcome of the general election is likely to spur investment in the North West property market, as greater political certainty supports dealmaking even as the Brexit turmoil continues, according to property leaders in the region.
Chris Cheap, principal and managing director of UK regions at Avison Young, told Place North West: “Regardless of political views, we welcome the certainty that the election results brings and the hope that it will underpin investor confidence.
“2019 was largely a flat year for the investment market, which is undoubtedly the engine room of the wider property sector, and positive business-focussed leadership should ensure this is not repeated in 2020.”
Richard Laming, senior director at planning consultancy Turley, said: “Our hope is that the major infrastructure projects which were put on hold during the election are now unlocked with urgency.” Such stalled projects include the proposed HS2 rail link between London, Birmingham and the North.
Conservative Party leader Boris Johnson soared to victory in Thursday’s election, winning the biggest Tory majority at Westminster since 1987 with 364 seats over Labour’s 203. “The country has given us a stonking mandate,” Johnson said.
Fundamentals ‘remain buoyant’
Surprise gains were made for the Conservatives in the North West, despite being traditionally a Labour heartland. The Tories added 12 seats in the region.
Losses for Labour included Manchester Mayor Andy Burnham’s former seat in Leigh, as well as Warrington South, Bury South and North, Burnley, and Blackpool South.
Merseyside stayed staunchly Labour with no seats lost to the Tories. Long-time Birkenhead MP Frank Field, formerly Labour and now Independent, lost his seat to Labour candidate Mick Whitley.
Turley’s Laming said the election results do not affect the fundamentals of the North West property market, “which remain buoyant”. However, the result is an opportunity to encourage greater investment and help implement regional economic development frameworks such Local Industrial Strategies, led by Mayoral Combined Authorities or Local Enterprise Partnerships, and free ports, he said.
“These could make a big difference and boost trade and industry in the region.”
Barry White, chief executive of Transport for the North, agreed: “The North has, quite rightly, been a key battleground in this election, with pledges made on improving our transport and creating opportunities.
“Now is the time to advance that Northern agenda in the national interest, and the Prime Minister must now deliver.”
Transport for the North has been “encouraged” by Conservative Party promises to fully commit to Northern Powerhouse Rail, and invest in the region’s strategic and local roads, White added. “That and tackling the challenge of making our networks greener and more inclusive will be critical in the coming months and years.
“There are big decisions ahead that will change the fabric of the North – not least how our railways are run and the delivery of HS2.”
Brexit resolution imminent
Johnny Caddick, director at Caddick Group, said: “This result and the political need to now fully support the North with world-class infrastructure will bolster confidence in regional economies, which will enable more capital to flow into housing.” The build-to-rent sector will continue to provide strong investment yields, he added.
Uncertainty over the UK’s departure from the European Union abounds, which could threaten the overall positive response to the election result. However, regardless of political leanings, some hope Johnson’s majority could enable a smoother exit from the union.
Jeremy Hinds, head of North planning at Savills, said: “I suspect I am at one with a prevailing view that Brexit will now resolve itself, and the country can focus on other matters, such as the very pressing need to build more homes. Uncertainty since 2016 will end, and the anticipation of that is already reflected in the stock and currency markets this morning.
“This is likely to lead to an increase in investor confidence, and Manchester will benefit from that.
“For the region, the PM will have to decide on HS2 and the transpennine link. The Prime Minister has been sceptical about HS2, but the desire to demolish the red wall probably means that he will want to retain votes. So I suspect the HS2 to Manchester will be given the go ahead.”
RIBA President Alan Jones said: “Many people will remember this as the ‘Brexit election’. The Conservatives must now deliver on their promise to resolve the political crisis which has been paralysing wider society and the economy.”
“We are adopting cautious optimism, as leaving the EU [planned for 31 January] is only the beginning of what has the potential to be a turbulent process,” added Avison Young’s Cheap.
“It will be interesting to see whether the new Government adopts a continued commitment to regional devolution, and to see whether it can build upon its new-found voter base in the north.
“Helping to drive whatever version of the ‘Northern Powerhouse’ we are on and underpin this with the necessary infrastructure improvements will be a very good start to achieving this,” he said.