Will Housing Prices Fall?

Monday's Financial Times features an in-depth treatment of the global housing market. The headline reads:
The Global Property BoomDangers of the Housing Market Delusion

The opening article is by Martin Wolf. Some interesting excerpts:

Higher prices merely redistribute income among residents [as opposed to creating real wealth], mainly from young to old

Where prices have risen far faster than underlying incomes, only two possibilities exist. Either prices have moved to a higher equilibrium level, in which case future purchasers will have to save more and consume less. That would itself have significant economic implications. Or they have reached an unsustainable level, in which case they will fall in real terms. That would have more significant economic implications. [Note that both possibilities have very significant economic implications]

The future will tell us which and where — possibly quite soon.