What has prevented the housing market from crashing?
Even though we all know that houses are overpriced, this is not enough to cause a crash. The average debt burden is massive, but at the moment it is manageable. By manageable I mean that everyone is not going bankrupt. The huge levels of debt are currently sustainable if interest rates stay low and unemployment stays low. All the time these two factors are low then you won't see a house price crash.
So that's your short answer but as always it's not as easy as that. We are on the brink of a house price crash but the question on everyone's lips is 'when'........this will be when the debt burden tips people over the edge, the market gets spooked and everyone runs for the hills.
A share price crash can happen in minutes but a house price crash can take many months. In fact it will have happened 6 months before it hits the headlines.
A recent post in the forum summed this up very neatly in a metaphor, " Equity markets can turn on a sixpence, it takes 2 minutes to sell a million shares. The housing market is like a supertanker .... It can take five miles to change direction. But once it's changed direction, it just keeps on going."