We need to remember that if houses are too expensive they do not sell.
Round where I live the builders are throwing up houses costing £600,000 and more and they sell like hot cakes, as do the less expensive ones. Cheapest (older) or housing eproperties are around £150,000, but really £200,000 is the starting price unless you buy part of a property and rent the rest. But everything sells, so there are plenty of people who can afford the properties on the market.
We need to remember that in the past a third of the population, those on lowest incomes, looked to the council to provide a decent house and life long tenancy. Many of them would never considered buying a house since they could rely on the council for their housing. The selling ofmcouncil houses for low prices gave some people unrealistic expectations of house ownership, while the reduction in the council housing stock and replacement with Housing Association and rent/buy offers means that people are forced into trying to buy a house, even though their chances of buying one will be low in prosperous areas like the southe east.