Is the house price boom about to end?

Will the housing market crash? We have been asking the question for two decades now are prices climbed to ever higher multiples of earnings. But apart from a few months in 2008 and early 2009, when prices did slide appreciably, it never seems to happen. Stock market corrections come and go but nothing will seem to dislodge housing from its inflated heights.

Having just gone through the most unlikely property boom in history, however – in which prices have surged throughout a pandemic – it is worth asking again. If we really have reached the end of the age of ultra-low interest rates that would remove the engine that has driven the long housing boom of the past three decades. You have to be in your mid-50s at least, now, to remember the days of double-digit mortgage rates. It is safe to say that today’s house prices would not be sustainable in such an environment.