Reading this BBC article on still-rising UK house prices, I'm reminded of this New Yorker article that Phil linked to a few weeks ago. In particular, note how the "previous" generation is helping out the current gen:
The building society suggests that many first-time buyers are being helped to get a foot on the property ladder by their parents remortgaging their own properties to cash in on rising house prices and giving their offspring a deposit.
Each month almost as many people remortgage their homes - borrowing more while staying put - as borrow to actually move house.
My rough memory of British demographics recalls something of a post-war baby boom. Is it possible that this demographic boom is now coming into its own - has paid off its mortgages and is able to provide some fresh economic input, partially fuelling (along with some other factors) the current house price bouyancy?
Note also the quote "A growing number of people have missed mortgage payments recently," - perhaps an indicator that the remortgaging activities above act as a "catalyst" for more house buying, but not necessarily as guarantee that mortgages following the initial buy will be paid back?
Note: plot house prices against population size. Might it be possible to predict when this boom will end? What would happen if so?