I know of a few people who bought houses in the early 00's before the crash at overinflated prices, it's only in the past couple of years that their houses have now a similar value to what they originally paid and there's nothing to say that these prices will continue to escalate they may indeed plateau or even fall.
There were 2 bumps in the road in recent times - about 1989-90 and 2008. Each one lasted maybe 5 years. Other than that prices *in most areas* have kept pace with inflation and as you say in London etc they have far outstripped salaries and inflation. I know 2 pals of mine bought a shared flat in about 1988, in the then new Docklands developments, with a bit of help from one set of parents. Cue crash. One later sold his half to his flatmate at a modest loss, the parents took a bath on about £20k (they were loaded, descended from a brewing family) and the other one stayed on and ate the big mortgage before moving on. Some other friends were hit by negative equity in the early 90s, the same applied. Bought in '88, cue crash, sold in '92, negative equity. They ended up with a loan of £14k on a house worth about £50k that they no longer owned, having paid c.£64k for it a couple of years previously. Ouch. Another friend, a workmate, had a similar tale, having paid £50k for a house in Leeds at a similar time. I bought an identical house, literally on the other side of the street, for £40k in 1995. Similar tales apply in 2008, I moved back to the UK from France in 2007 and looked at housing in Hull. Deciding that I'd rather live in the sea than in Hull I gave up and rented a little place until I worked out what I wanted to do. Good move, the job evaporated and housing prices collapsed. I moved to Leeds and rented, I could have ended up taking a proper bath on that one. Prices were pretty static post crash until and after I bought this place 8 years ago at the end of 2014. They were very steady until 2017-18, only in the last couple of years have I seen some dramatic jumps in value. I have however seen +50% in value overall in the 8 years, judging by local sold prices, which is about 5% a year, with compounding. My pension investment has outstripped this *some* years but not every year, and bear in mind that my pension is actually invested in companies that do work, not just piles of bricks, and is moved around by investment managers who want to optimise return.
One thing I have noticed is that rich areas are getting richer and poor areas poorer. Housing in Bradford, Barnsley and Grimsby is going nowhere. Nice bits of Leeds, Harrogate, York, Lincoln, Jesus. Hang on to your hat. I am surethat this is echoed elsewhere.
