Will there be a house price crash?

"An increasing population, people living longer and a chronic shortage of housing stock are the biggest factor pushing prices ever higher. As mortgage rates rise, inflation soars and wages stagnate, there's every chance of a price correction but we're unlikely to see a repeat of 2008 as the due diligence undertaken on new mortgage applications is far more robust than it ever has been before."

"The basic economics of any market are supply and demand. In the UK housing market, there is a chronic undersupply of housing and therefore demand is not, and cannot, be met, which is why we see house price growth nearly constantly. However, there is another part to the equation: funding. Houses are big ticket items and people cannot buy them without borrowing money, so the thing that causes house prices to fall in the UK is not a lack of demand, or an oversupply of property, but when funding is withdrawn. This is what we saw during the credit crunch. As lenders withdrew loans for those with small deposits, i.e. First Time Buyers, this strangled the housing market and therefore prices fell. As soon as the Government stepped in with things like Help-To-Buy, low-cost funding and guarantees for lenders, we saw a rapid return to house price growth as mortgages became available to the masses again. So, will we see a house price crash? It all depends on the mortgage lenders and their confidence to lend to us all."

"Interest rates have only risen from the all-time low and are still super low in the grand scheme of things but price growth will almost certainly slow down compared to the past 18 months. The biggest issues facing the housing market are the lack of stock and lack of incentives for people to sell properties to allow mobility within the housing market. Until more affordable housing is built, demand will continuously outstrip supply in the market. Yes, there will be a minor correction in pricing but I don't expect a 2008 scenario anytime soon while employment rates are still high and demand for housing still strong."

"No. As we are so obsessed with home ownership in the UK, if prices were to crash, they would quickly be pushed up again by first-time buyers and landlords snapping up the cheap properties. Whilst we are likely to see a decrease or slowdown in the rate of price growth, a crash is not on the cards."

"House prices are going to keep increasing. Higher interest rates are putting many people off from upsizing and affecting stock levels. So when a decent property comes on the market in a good area, sellers are getting several more more offers from keen buyers. This demand is pushing prices up. It is definitely a seller's market at the moment. There will not be a crash. The market has showed resilience during the pandemic and will continue to do so. Banks have been stress testing all borrowers at 5.5% - 6% for many years so current interest rates are not a cause for concern. If buyers can afford to buy a property, they will, it’s as simple as that."

In a word, No. We live in a country where there are less houses than people willing to buy or rent. Throw in that we're even worse at building enough new houses yo keep up with new demand let alone the backlog, and this means house prices can only continue to go in one direction in the long term. We won't see a crash but we may see the rate of growth slow to sensible levels and we also may also see energy efficient homes be more in demand than older drafty houses as people count the costs to keep warm and legislation changes hit on the road to our net zero commitments.