All of the above may be true. To the predictions of gloom you can add what if India and Pakistan go to war? Oil price goes through the roof, immediate stock market crash, interest rates rocket, housing boom stops dead in it's tracks, economy goes into recession, job losses spiral, repossessions start to explode as mortgage defaults increase....all the potential ingredients are there for a spectacular collapse.(posted 7997 days ago)Alternatively, the right to let boom being effectively over, more houses could come onto the market as investors try to get out at the top, and this will redress to some extent the shortage of property that is fuelling the present boom.
Personally I think we are in for a crash of some kind, because we are now into a self propelling market where people looking to sell their houses are spurred on by irresponsible index makers like Nationwide and Halifax telling them house prices have risen by 2 or 3% in a month, so that they think they can add on thousands to the asking price.
The effect of these inflated and greedy prices is that the fear of being left out then rises as people not on the property ladder begin to panic, and rush to buy before (as they imagine) they are priced out. Interesting that amid all the programmes on TV about house hunting, interior remodelling, and garden design, there seem to be none about the downside of the market and the repossession nightmare. History teaches that we are doomed to repeat the mistakes of the past doesn't it?