UK house prices have recovered from the slump that followed the financial crisis. According to the Office of National Statistics, UK house prices have risen 45 per cent since their trough in March 2009.

Over the same period earnings have risen by just 16 per cent making life tougher for first-time buyers and those trading up in the housing market.

Financial crises tend to collapse asset prices and make housing more affordable. It’s been different this time because the authorities in the UK, and elsewhere, countered the crisis with low interest rates and quantitative easing. By slashing the cost of money and flooding the system with liquidity these policies set out to, and succeeded in, inflating asset prices. UK equities and house prices have risen at roughly the same amount in the last ten years. Taken together with weak wage growth the result is that housing in the UK, and in many other countries, has become less affordable.

UK house price inflation has slowed since the EU referendum. This bucks a global trend towards higher house prices. An index produced by surveyors Knight Frank shows that house prices rose by 6.5 per cent globally in the year to March, the fastest pace in three years.

How overvalued is UK housing? And how does it compare to house prices elsewhere?

Two standard yardsticks compare house prices to rents and to incomes relative to long-term averages. At £223,000 the average UK house is almost ten times median annual earnings. The Organisation of Economic Cooperation and Development estimates that UK housing is 30 per cent overvalued against incomes and 28 per cent overvalued against rents.

US housing looks better value. Despite having risen 34 per cent since early 2012 the OECD estimates that US housing is 6 per cent undervalued against incomes.

Across the 23 industrialised nations studied by the OECD housing is most overvalued in New Zealand, Australia, Canada and Belgium.