In the UK's last recession in the early nineties house prices crashed two years after the stock markets crashed. When the stock market crashed the government us

In the UK's last recession in the early nineties house prices crashed two years after the stock markets crashed. When the stock market crashed the government used low interest rate to boost the economy. This had the effect of keeping mortgages avoidable. However when the economy recovered interest rates had to be put up because of inflation. The resultant increase in the cost of mortgage repayments along with high unemployment, a lagging indicator, resulted in high repossession rates and the property crash.