Loads of money floating about becuase of QE and historically low interest rates Lack of supply Buying houses looks ok looking at a payment of say 3.5% interest for a mortgage(if you can get the deposit or trade up etc) For 'investors' nowhere to put their money really. = PRICES UP Coming soon - tax raises, increased unemployment, continued underemployment, decrease in public spending, likely run on pound and resulting increase in inflation (we import practically everything) but not enough to really inflate away big debts (like mortgages), subsequent increase in interest rates and people just forget how low they are if base rate goes even to about 4.5% we'll start seeing significant repossessions. Prices fall. The markets still overpriced and the current rise is a classic dead cat bounce (I'd say the same for the stock market too). All my opinion obviously. BTW, inflation is mainly bad because of what it does to savers and those on fixed incomes such as many occupational pension holders.