Report London And Why Hpc Has Been Wrong For 10 Years in Anecdotals Posted January 23, 2015 I think the foreign money as a driver is more myth than meaningful. It might pay for the glittering blocks along the riverfront but what's driving the city-wide rise has always been cheap money and ambitious couples - like the OP and partner - who are ready to take the debt on. When the banks take the easy money away, prices tank. It might be fair to say that property in the UK was undervalued in 97 and lawyers/agents were almost talking you out of bothering to buy, there was no property service industry like today. But rather than foreigners arriving with suitcases of cash to buy modest terraces in Acton etc, I see it as a long easy-credit binge from 2000-onwards to keep the economy chugging as the West declined. The chug hiccuped in 2008, first sign of the artifice/rigging exposed behind the scenes, and then they fired it up again. I feel as though we're getting close to another hiccup now, but there's still an awful lot of cheap money sloshing around. But I can see London crashing, just as it has at points over the last 100 years, always related to events and always fragile. You can't have an economic model that only pays out, it would be like a desert casino where nobody can lose as long as they put their chips on the table. Casinos need suckers. Even Tokyo crashed. London is no different, they can't take us back to an 80s style public sector state and preserve the common wealth, the property gains will be stripped away. Just to clarify as the OP - when we bought our first flat at £94k I think we just about had a joint income of £94k. When we bought the second flat at about £320k we only needed a £200k mortgage, actually I think my wife had stopped working but I was earning about £75k. So not exactly nutty multiples. My original point in this thread was that is it obviously easy to be overleveraged, but in a low interest, cheap money, asset inflation bubble if you want to keep up with the jones's you need a bit of leverage. We sold up, and are now completely debt free (actually I owe £320 on my amex credit card which I pay off every month, just use it to get airmiles!). We will never be able to move back to London. Luckily I dont particularly want to. My wife might want to though. Just saying that hpc (and myself) called it completely wrong on London over the last 10 years.