What has affected the UK property market over the past ten years?

The UK property market has often made the news over the past decade. There have been many different influences at play, from the impact of the 2008 recession to the more recent effect of Brexit. House prices have fallen and risen again and different buyers and investors have come and gone from the market. We have also seen key government intervention that has started to change the way that the UK property market functions. So, what have been the key influences over the past ten years?

The 2008 recession

When the recession began in 2008, confidence was affected across many different financial markets. According to Nationwide’s Monthly Indices, by February 2009, house prices had fallen 19.6% in 16 months and were at an average of £147,746. By June 2009, there were signs of recovery within the market with the volume of property transactions starting to rise consistently and consecutively over the intervening months.

Interest rates

As the vast majority of property purchases tend to involve lending, interest rates have also been a significant contributing factor when it comes to the impact on the UK property market in the past decade. In 2008, interest rates were at 5.5%. However, after the 2008 financial crisis they dropped to less than 1% and then remained there. This has made mortgages much more affordable than they were pre-2008 – for those who are eligible for them.

Foreign investment

Over the past decade, the falling value of the pound has made the UK property market increasingly more attractive to foreign investors. In particular, there was an influx of property purchases from overseas investors after the Arab Spring financial crisis when investors from certain locations needed somewhere to deposit capital quickly to move it out of other markets. Currency impact after the Brexit referendum has also made the UK property market cheaper and more accessible for those investing from overseas.

Fluctuation in buy-to-let

Thanks to low interest rates and favourable conditions, buy-to-let purchases have been increasing for much of the past decade. This has had a considerable impact on the volume of property stock available for residential buyers, such as potential first time homeowners. Recent changes to how income from property is taxed have altered this significantly, in many cases causing existing landlords to sell. Plus, an additional 3% rise in stamp duty costs on second homes has discouraged many potential buy-to-let landlords from entering the market.


It’s impossible to ignore the impact that Brexit has had on the UK property market, both in terms of pricing (which has adjusted by 15% since 2014) and market conditions. Today, as a result of the Brexit referendum and the uncertainty surrounding the process of the UK departing the EU, there is a lot of hesitancy among both buyers and sellers. Some purchases are taking longer to complete and some end up completely stalled.

Like any market, UK property is affected by a range of different factors. Currently, despite the impact of Brexit, there are many opportunities available to both buyers and sellers.

Contact Clarke Gammon Wellers today to find out more about the latest market trends or to see if we could help you find or sell a property.