To the question ‘Is a property crash really unthinkable?’ the answer has to be no.  It is certainly unpalatable but unfortunately it is not inconceivable.  The main point when it comes to the housing market is consumer confidence.  When confidence is low the thought of moving house, unless you absolutely have to, is something that many people will put on hold.

For those of us in the industry, furnished with all the information we are, it is hard enough.  For the average man and woman on the street, relying on the mainstream news and the likes of Martin Lewis for information, the situation has to be looking quite tricky.

This all points to a downward turn for the market and with that the inevitability that house prices will fall, with some regions affected worse than others.  Unfortunately, it is the poorer areas of the country that are historically hit the hardest.  Any average figure we see in next half of the year is unlikely to be truly indicative for many.

One area to consider, when we read about the number of adults living with parents into their 30’s, is the bank of mum and dad.  This source of funds, which many have relied upon to get onto the property ladder in recent years, is also feeling the squeeze.  Add to this the additional costs landlords are facing due to minimum standards and the inevitable increase in rents as a consequence, and it is no wonder that many will be living longer with parents.

The trouble that the Bank of England has is that no matter what they do with interest rates and how high inflation stands, people are still spending money.  Until that spending is curbed the Bank will have little choice but to continue on its current path.

The question, as far as lenders are concerned, is how much of current spending is on credit card or unsecured credit?  If that credit bubble bursts the relatively low number of repossessions and arrears we have seen recently is sure to rise.  Then we will be looking at a very different picture and prices may indeed tumble.