Will UK House Prices Crash?

Will UK House Prices Crash?

Here's Why It Probably Won't

Mortgage payments are climbing. House prices are hovering at roughly eight times average earnings. Millions of young people are effectively locked out of the market. So, surely, something has to give sooner or later?

Surely sellers will have to cut their prices. Surely this ends with a UK housing crash. It's a fair question, and honestly, it's one I hear all the time. But here's what most people overlook. House prices don't crash because buyers can't afford to buy.

They crash when sellers have to sell.

That's really the whole picture in a single line. A crash takes a wave of homes coming onto the market all at once, with owners desperate to exit at almost any price. Think back to when interest rates hit 15%. People couldn't keep up with their mortgages, homes were repossessed, and prices fell hard. That's what a genuine crash looks like. Forced selling, and lots of it.

Now look at where we are today. More than a third of homes in this country are owned outright. No mortgage whatsoever. About 36% of households simply don't owe a penny on their property. On top of that, people are living longer and remaining in their homes for longer too.

These owners don't have a lender breathing down their neck, and they've got no reason to move quickly. So they stay put. If you don't need to sell, high prices don't force your hand. You wait. And what about all those first-time buyers who've been priced out? They don't vanish either. They remain in the rental sector. Nothing compels a sale, so nothing compels prices downward. The whole thing just sits there. This is the bit people find maddening, and I do get it. Expensive housing feels like it ought to trigger a crash all by itself. But it doesn't. Selling causes a crash, not high prices. And in Britain, with millions of homes already paid off, the ingredients for a real crash simply aren't in place.

So yes, millions of people are struggling to get on the ladder. That part is absolutely real. But at the same time, there are millions of homeowners with no need to sell and no plans to do so. Those two groups offset each other, and the market just keeps grinding on. Could prices dip a bit? Of course. Markets rise and fall, and some areas will soften more than others. But a dip isn't a crash. A flat market isn't a crash. A slow market isn't a crash. A crash needs forced sellers in very large numbers, and right now, we just don't have them.

For anyone sitting on the sidelines hoping prices will collapse, my honest advice is simple. Don't hold your breath. It's far more likely the market stays expensive and stubborn than suddenly falls off a cliff.If you want a straightforward answer about what your own home is worth in today's market, that's exactly what I do. No call centre, no sales patter, just honest local advice.

Chris Bowman Managing Director, Bowman Estates Office: 01706 310171   |   Mobile: 07597 407219 88 Bolton Road West, Ramsbottom, BL0 9PD bowmanestatesltd.com   |   Instagram: @bowmanestates_