My theory is that bank loans are to blame. When we say someone has "bought" a home, it's rare that they've actually bought it, rather they've just signed a cont

My theory is that bank loans are to blame. When we say someone has "bought" a home, it's rare that they've actually bought it, rather they've just signed a contract promising that they'll pay back a huge sum of money they don't have over a long period of time. This creates a market of buying and selling of -- in the words of Mark in The Wolf of Wall Street -- fairy dust. Big numbers like £500k, £600k are thrown around that nobody actually has. The ability to loan large amounts of money like this detaches people from the actual buying power of their money and the price of the property they're buying. Two grand in the bank is a nice amount of money. A two grand price increase on a property amortised over 20 years is considered to be nothing because the repayments are almost the same. The solution to bring prices back down to ground level in my view is to end mortgages. Require the money up front and therefore force prices to drop until an equilibrium of affordability is reached. Needless to say this will never happen because the people who have the power to push for this are the ones benefiting from the status quo. NB: I am not an economist.