You might have seen a surprising statistic doing the rounds recently: over the last 10 years, UK house prices have only increased by 8.29%. In a country where property is a national obsession, that number can feel not just wrong, but almost impossible.

You can check the stats for yourself at Global Property Guide.

But before you panic, the key to understanding this figure lies in two crucial words: “in real terms.” This simply means the price change after the corrosive effect of inflation has been stripped away. While the price on the sticker may have gone up, the rising cost of everything else has meant the actual value of UK property has barely budged.

This weak performance is a symptom of a market struggling with deep-seated issues.

So, before we break down the problems, let’s define what a solution—a healthy and stable housing market—actually looks like.

What a Healthy Housing Market Needs
For decades, the UK has relied on cheap debt to fuel price rises. A truly sustainable market doesn’t need tricks; it rests on three strong pillars:

Controlled Inflation: Low and stable inflation is the bedrock. It protects the value of money, ensuring that any increase in your home’s price is a genuine gain in purchasing power, not just an illusion.

Real Wage Growth: People should be able to afford homes through their earnings. When wages are rising faster than the cost of living, buyers have the genuine financial power to save for deposits and make mortgage payments without overstretching themselves.

An Adequate Housing Supply: The market must build enough homes to meet the needs of a growing population. A healthy supply prevents frantic bidding wars and ensures prices are grounded in reality, not scarcity.

Over the last decade, the UK has struggled with all three of these, and the 8.29% figure is the result.

The Big Story: How the UK Compares
The most revealing part of this data is where the UK sits compared to its European neighbours. The Global Property Guide’s table shows a vast spectrum of performance. At the top, countries like Portugal have seen a phenomenal real-term increase of 151.29%.

Then you have a group of solid performers like Germany, which saw a more moderate but still very healthy 20.91% real-terms growth. The UK, with its 8.29% growth, is significantly underperforming. This isn’t just bad luck; it’s a sign that the fundamental pillars of our market are weaker.

Why the UK Has Lagged Behind
So, what went wrong? The modest growth was caused by a combination of factors that undermined the three pillars of a healthy market.

1. The Inflation Drag
The primary culprit is inflation. The UK has experienced a sustained period of relatively high inflation that has relentlessly eroded the nominal gains seen in property listings. While house prices were going up, the rising cost of living was going up almost as fast, cancelling out much of the real value.

2. The Psychology of Brexit: A Climate of Fear
Let’s be clear: the predicted house price crash following the Brexit vote never materialised. The act of leaving the EU did not, in itself, cause a direct negative shock to property values.

Instead, the market was impacted by the reaction to the event. The years following the referendum were dominated by a climate of intense uncertainty, fuelled by overblown claims and dire economic predictions. This widespread hysteria created a national crisis of confidence. Faced with an unpredictable future, potential buyers and sellers did the most rational thing: they waited.

This widespread hesitation—a collective pause—is what acted as a brake on price growth. It wasn’t a market collapse, but a long cooling-off period driven by the fear of the unknown, rather than a tangible economic failure in the property sector itself.

3. The Affordability Ceiling
The UK entered this period with an existing affordability crisis. With house prices already incredibly high relative to earnings, there was simply no room for further growth without the fuel of real wage increases. With real wages stagnating for much of the decade, the market had hit a natural ceiling.

The Path Forward: Why Supply is the Key
Looking ahead, controlling inflation and fostering real wage growth are essential. But even if we achieve that, there is a missing piece of the puzzle: we need to build more homes.

Without a significant increase in housing supply, any economic recovery will simply create more demand for the same limited number of properties. It’s like adding more buyers to an auction with only one house – the price just spirals upwards, and the affordability crisis gets even worse.

Increasing the supply of new, well-designed homes is the only way to ensure that a healthier economy translates into a healthier society, where people can afford to live and thrive. It’s the critical component that turns demand into sustainable growth rather than just another price bubble.

That 8.29% figure isn’t a sign of collapse. It’s a sobering wake-up call that the old model is broken. The future health of the UK property market depends not on financial wizardry, but on a return to fundamentals: stable money, better pay, and building the homes our country needs.

The recent Local Plan review has delivered a clear message for Sheffield’s future development. The Planning Inspector’s findings touch on key issues that will shape the city for years to come:

✅ More new homes
The review confirms that Sheffield must plan for a significant increase in housing supply. The demand for homes isn’t going away, and the city needs to meet these needs head-on.
✅ Political cover for greenbelt release
Releasing greenbelt land has always been contentious in Sheffield. The Inspector’s report gives local politicians the backing to move forward with carefully considered greenbelt releases, balancing growth with environmental concerns.
✅ City centre density
Increasing density in the city centre is a priority. This means encouraging more homes and businesses to locate in the urban core, making better use of existing infrastructure and supporting regeneration.
✅ Pushback on “brownfield first” dogma
While brownfield development remains important, the Inspector acknowledges that focusing solely on brownfield sites isn’t realistic or sufficient to meet housing targets. A more flexible approach is needed.
✅ Ticking 5-year land supply clock
Sheffield is already falling behind and faces pressure to maintain a five-year supply of deliverable land for housing. Falling short causes intervention from developers and government, so maintaining this supply is crucial.
✅ Reminder soundness trumps politics
Finally, the Inspector reminds all stakeholders that the plan must be “sound” – legally robust and evidence-based. This requirement takes precedence over local political disagreements and ensures Sheffield’s plan can withstand scrutiny.

Twelve months ago, a new government came to power with a bold promise: to get Britain building again. At the heart of this commitment was the ambitious target of delivering 1.5 million new homes in England over the course of the parliament. With the first year now complete, it’s time to take a high-level look back at the progress made—or rather, the lack of it—and the significant challenges that remain.

The government’s strategy hinged on a revitalised planning system and a greater focus on building on brownfield and “grey belt” land. They promptly reintroduced mandatory local housing targets, aiming for a national total of over 370,000 new homes per year—a rate not seen in decades. This was a clear signal of intent, but as the data from the past year shows, ambition does not automatically translate into bricks and mortar.

The First-Year Reality Check

While the government has consistently stated that housebuilding will “ramp up” over the parliamentary term, the initial figures tell a sobering story. Provisional data for the first year suggests that we are nowhere near the pace needed to meet the overall target. One estimate, based on new Energy Performance Certificate lodgements, put the net addition of new homes at around 186,600 in the first 11 months since the election. This is far below the roughly 300,000 homes needed annually to hit the 1.5 million goal within five years. The shortfall is not just a statistical blip; it is a sign of deep-seated issues that the new policies have yet to solve.

Skepticism remains high among industry experts for a number of reasons:

• The Land Shortage: While the focus on brownfield and “grey belt” land is a welcome shift, it does not solve the fundamental problem of a shortage of viable, available land. Many of these sites require significant investment in clean-up and infrastructure before they can be built on. The promise to build new towns is a long-term strategy, but it will not deliver the immediate volume of homes needed.

• A Broken Planning System: The planning system remains a major bottleneck. Despite promises of reform, a shortage of skilled planning officers is a persistent issue. This leads to backlogs, delays, and a system that is still far from efficient. An ongoing report by the Home Builders Federation shows that planning permissions for new homes have continued to fall, reaching a decade-low in 2024. This is a critical forward-looking indicator, suggesting that even if market conditions improve, a lack of sites with permission will stunt future output.

• Economic Headwinds: The housing market is still navigating high interest rates and broader economic uncertainty. This has squeezed developers’ margins and impacted consumer demand, leading some housebuilders to slow the pace of new construction.

Looking Ahead

Despite the slow start, there are glimmers of hope. Homes England has reported exceeding its own annual targets for 2024/25, with increases in both new homes started and completed, a positive sign particularly for the delivery of affordable housing. However, the government’s success will ultimately be judged not just on its policies, but on its ability to turn ambition into action, overcoming long-standing political, economic, and systemic hurdles to deliver the homes the country so desperately needs. The next twelve months will be critical, but for now, the apathetic shrug from a weary industry is perhaps the most telling indicator of progress.

In the world of property development, a stark and concerning trend has emerged: lending to small and medium-sized housebuilders has been in sharp decline. According to a recent analysis, bank lending to these crucial businesses has plummeted by 49% since 2017. This isn’t just a financial footnote; it’s a symptom of a much larger, systemic breakdown in how we build homes in the UK.

The widely cited UK housing crisis won’t be solved by a single policy or a single actor. It requires a “whole solution”—a holistic approach that tackles the interconnected failures across the entire development process. Lenders cannot be expected to deliver up finance in a highly technical industry that has been hollowed out and made inaccessible to all but the largest, most established housebuilders. This is a problem that spans the entire lifecycle of a development, from concept to completion.

The Interconnected Problems

• Land: The journey to building a home starts with land. The shortage of viable, shovel-ready sites is a persistent issue. Despite a focus on brownfield sites, many require significant and costly remediation, and are not a quick fix.

• Planning: The planning system remains a major bottleneck. A lack of resourced and skilled planning departments leads to significant delays and uncertainty, making it difficult for smaller developers to invest the time and capital required.

• Finance: As the lending figures show, securing finance is a monumental hurdle for small developers. Post-2008 regulations have tightened lending criteria, making it easier for large corporations to secure capital while starving the smaller, agile firms that often provide local, bespoke development.

• Apprentices: The industry faces a skills gap, with a shortage of qualified tradespeople and a pipeline of talent that is struggling to keep pace with demand. Without a strong apprenticeship and training system, even with land and finance, the homes simply cannot be built.

• Legal: The legal framework, particularly around planning and land acquisition, can be complex and slow. Simplifying this process is essential to reduce risk and speed up delivery.

• Infrastructure: New developments require a foundation of supporting infrastructure—roads, schools, GP surgeries, and utilities. The lack of coordinated planning and funding for this infrastructure often causes significant delays and community opposition.

• Valuation & Marketing: Even once built, bringing a home to market requires a robust valuation and marketing process that understands and reaches the right buyers. For smaller builders, this can be an additional challenge without the scale and resources of the larger firms.

The decline in lending to small builders is not an isolated issue; it is a direct consequence of a system that has been gradually made too complex, too risky, and too costly for them to operate in. To genuinely “get Britain building,” we need more than just targets and rhetoric. We need a fundamental rethink that addresses all these issues in concert. This means finding innovative solutions for land assembly, streamlining planning, creating new pathways for development finance, and investing in the skills and infrastructure needed to build a vibrant and diverse housing market for everyone.