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By Richard Williams, Emanuela Barbiroglio and Richard Hook

Survey: industry braces itself for worst following election

Last week’s shock general election result is expected to have a broadly negative impact on all sectors of the real estate industry, a snap survey of Property Week's readers reveals.

The investment market is forecast to suffer the most, with 66.5% of the 260 respondents saying they thought investment deals would tail off due to political uncertainty.

“Initially, there may be a slowdown in transactional property deals, while people wait for some form of certainty for the short to medium-term and clarity as to how much cross-party involvement there will be in the Brexit negotiations,” one respondent said.

Development decisions are also expected to be put on the back burner, with 63% of people indicating that development would be negatively affected.

Commercial property is expected to be harder hit than residential. Some 61.5% of respondents said the election would have a negative impact on commercial, compared with 53.8% for residential.

Scottish commercial property is expected to fare best after the poor showing from the Scottish National Party reduced the chances of another referendum on independence. Over a third of readers said the election result was positive, just shy of the 37% who said it was negative.

Exactly half believed the general election outcome would result in a ‘soft’ Brexit, which would be good for the industry. “Short-term uncertainty won’t help occupational fundamentals but a soft Brexit will yield greater long-term upside than the previously contemplated hard Brexit,” a reader said.

Election survey graphic

Only 14.2% said they had changed their plans because of the result, with 43.5% saying they would maintain a watching brief and 42.3% stating their plans were not affected.

There was a similar response when asked how they expected live deals to be affected. More than half (55%) said they would be unaffected, but 6.5% expected their deals to be called off, with 13.1% anticipating a price change and 25.4% believing the deal would drag on.

Some respondents also predicted that the result would create buying opportunities. “[It] may generate some value to buy... for the brave,” one stated.