Broad consensus that house prices are too high

Britain’s leading economists are almost unanimous in their view that house prices are still too high. Of the 70 who answered the question, 13 believed residential property prices were now fairly valued, while 55 said they were not and two did not express a view. The judgment that the housing market remains overinflated sits uncomfortably alongside extensive evidence that prices are rising rapidly. But the general view is that the recent surge in prices reflects low interest rates and low levels of supply - a situation that cannot last for long. House prices are also likely to be hit by weak income growth and still weak bank lending, economists argue.