Tim Mycock, development director at Reditum Capital believes that the election has been no help to a market that reveres stability.

Only just recovering from the shock of Brexit and the arrival of Trump, investors are understandably operating with an air of cautiousness again, as the result of a snap election that arrived as a huge surprise. More so, the landslide expected by Theresa May a month ago has been cast into doubt as Labour’s poll position has recovered to suggest a hung parliament could be imminent.

A decisive victory in any direction would have gone some way to repairing this uncertainty, as lending has tightened up largely down to a “wait and see” attitude from some lenders. These will have no doubt been grateful for this election being short by comparison to previous ones, at just seven weeks. Yet as the likelihood of a hung parliament increases, so does the prospect of further reductions in lender confidence.

These last few years of insecurity are now taking their toll and both overseas and senior UK-based lenders could hit the brakes on funding decisions, particularly outside London where other cities don’t share the same air of invulnerability as the capital.

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The move from investment to higher cash balances is part of an industry wide trend to adapt to the circumstances of political uncertainty and it could suggest that the property market is indeed vulnerable to political and economic shock.

Meanwhile, critically low levels of property transactions across three London boroughs in April and a slump in London house price growth to 3.5% suggests a pause in the market may be more than a relative blip. These changes, partly related to stamp duty increases, are part of a wider trend of uncertainty that has become prominent in the British property market.

The snap election has likely subdued the market significantly, but expectations that this will change dramatically after the election should be treated with caution. Some improvements should be expected, as many property experts have recommended waiting for the election to finish to their clients before moving forward with deals.

Short-term finance is providing favourable funding options during these times of geopolitical instability, where traditional lenders may hit the brakes on funding larger developments. Bridging loans have unsurprisingly spiked in activity in 2017, in reaction to this absence of conventional funding, and this could very well continue to grow.

A decisive outcome could create a surge of activity as a result of this hesitancy. However, if faced with a hung parliament, as opposed to the decisive victory the British housing market has been crying out for after back to back years of instability, the market for traditional lenders may remain stagnant long after 8^th June.