"A Conservative government will act now on debt to get the economy moving. We will deal with the deficit more quickly than Labour, so that mortgage rates stay lower for longer with the Conservatives." - Conservative Manifesto
Something that always affects the property market in Britain, as elsewhere, is the availability of credit to purchase costly sections of land. Without the financial means to fairly compensate an owner for his/her land, there is either unfair compensation (under-payment or outright theft) or there is no deal.
The first option is sometimes, in rare instances, acceptable to enlightened societies like Britain, where the eminent domain of the government takes precedence and certain tracts of land are set aside for public use, with little or no fair-market value going to the previous owner. An example of this is the thin strip of land used for railways.
But the other side of that, no deal, is far more detrimental to human welfare, because it seriously obstructs the rational use and development of land, waterways, beachfronts, mountains, forests or underground mines simply because there is no credit mechanism available to acknowledge and enable transfer of the lands from one owner to another for the greater good.
So a government willing and able to act now to get rational debt, debt instruments and debt-service mechanisms into the hands of rational risk-takers and entrepreneurs among their people is a sign of faith in the proven creativity of humans, and British are among the world’s most renowned inventors and innovators.
Likewise, dealing with consumer debt and corporate debt is a logical step in a good direction if it results in improved conditions overall for buyers and sellers, as is the case with the property market in Britain.
Without buyers there can be no sellers, and that means no tax for any government. But without financial means to buy, there can be no buyers, and that means no taxes for government.
In summary, the timely and effective efforts of government to bring about a credit market where credit is available to qualified borrowers is a policy which should actively enhance the property market in the UK. Couple that with the fixed low interest rates on mortgages and there is a solid framework for continued growth and vigor in Britain’s property markets and housing markets for the foreseeable future.