For decades, people in the UK lived by an almost sacred belief: property prices always go up. Buy a home, and you’ve secured your future. This mindset became the foundation not only of household finances but also of government policy — from subsidies to pension planning. But in recent years, that belief has started to waver.
More and more experts — including those at the Financial Times — are asking an uncomfortable question: what if the property boom is over?
A Look Back: How Things Used to Be
Starting in the 1970s, the UK housing market seemed unstoppable. Prices climbed year after year. People bought homes, then bought second homes, rented them out, upsized, and built wealth through bricks and mortar. It was a tried-and-true formula for generations.
Today, the total value of UK property is a whopping £9 trillion, with £6.4 trillion owned privately. But here’s the catch — almost half of that is held by people over 60, and they owe very little on it. In fact, only 2% of their assets are tied up in mortgage debt. Meanwhile, young people under 35 own just £600 billion worth of property — and half of that is mortgage debt.
In plain terms: older homeowners live mortgage-free. Young people? Still paying it off.
What’s Happening Now?
Today’s growth in house prices is the lowest in 50 years. That’s not a typo. Adjusted for inflation, prices are barely moving — and sometimes even falling.
But price isn’t the only factor. Interest rates are high, getting a mortgage is harder, and lending conditions are stricter. Even if you want to buy, you might not be able to. That’s why demand is weak, sales are down, and new builds are slowing.
And this isn’t just a blip. Experts now say that, long term, property prices will likely rise in line with wages, rather than significantly outpacing them like before.
Good News or Bad News?
That depends on where you stand.
- If you’re a first-time buyer, especially a younger one watching the market with despair — this could be welcome news. Finally, prices might stop “running away” from you faster than you can save.
- But if you’re a homeowner hoping to fund your retirement by selling your house at a big profit, it’s time for a reality check. That kind of return may no longer be guaranteed.
In other words, property is no longer the “golden ticket” it once was. For the over-60s, it was a sure path to wealth. For younger generations, that certainty has vanished.
So What Can You Do?
Here are a few down-to-earth takeaways:
- Buying a home to live in still makes sense. If you’re purchasing a place for yourself rather than trying to profit from rising values, you’re probably making a solid move. You may not get rich from it — but you’ll have your own place to call home, without a landlord calling the shots.
- Letting property can still be profitable — just don’t expect miracles. Rental income may still cover the bills and give you a return, but it’s no longer the low-risk, high-reward option it once was.
- Don’t rely on property alone as your financial safety net. What worked for your parents might not work for you. Think about spreading your risks: some savings, some investments, some pension planning — and yes, some real estate if it fits.
- Planning a future move based on rising prices? Rethink that. The market may not give you the “extra” cash you expected from a big sale.
And Maybe That’s a Good Thing?
On one hand, yes — the market is less predictable. But on the other, this shift could be levelling the playing field. Young families might finally have a better shot at buying their first home without needing a 35-year mortgage. Older homeowners might explore downsizing or equity release to boost their retirement comfort.
In any case, the mindset of “buy a house and you’re set for life” is no longer a guarantee. And maybe that’s not such a bad thing — it forces us to think smarter, plan better, and not put all our eggs in one (property-shaped) basket.
To sum it up: UK property prices probably won’t soar like they used to. But they’re also not expected to crash. Instead, the market is calming down — and we should adjust our strategies to match.