Actually it'd make sense* if that was the case, but for some reason I've only ever seen it the way I described. However I am going by the coverage I saw when I lived in the UK ~3 years ago so my recollection may be fuzzy or exaggerated.
* = by "make sense" I mean it'd fit within the my cynical view of the media's "hysterically report on things to drum up interest" strategy.
Falling prices are bad in the current arrangement, unfortunately, for more reasons than the current owners being upset: a bunch of other financial products are also tied to them, so falling house prices cause a mess cascading beyond just the real-estate market. E.g. the 2008 crash produced defaults on housing derivatives worth more than the entirety of the actual real-estate in question, which in turn produced bank failures, etc. (Not a good situation in the first place, but it's why financial news treats falling housing prices as negative news.)
> a bunch of other financial products are also tied to them, so falling house prices cause a mess cascading beyond just the real-estate market
That's an argument for gradually deflating housing prices, assuming they are overpriced. If people are running businesses and preparing for retirement with faulty price projections in mind, I don't see why others (people who don't own homes, mind you) should be forever penalized because the system is already stacked against them.
I agree they should be deflated, if overpriced. My point was that the people who don't own homes also suffer from real-estate declines in many cases, with the current way the financial system is intertwined with real estate (which is itself a problem). By dollar terms the vast majority of money lost in the '08 real-estate crash was lost by people who didn't actually own a house or condo, because the second-order losses were much larger than the primary losses.
