The International Monetary Fund has warned that rising interest rates in some of the world's biggest economies may slow global house price growth.
The UK could be one of the countries most at risk
Most at risk are some of the world's richest countries, where the property market has boomed in recent years.
Since 1997, house prices are up by at least 50% in nations such as the UK, Spain, Ireland and Australia.
The IMF said it is hard to justify all the gains and should house prices dip, then the global economy may suffer.
"In cases where house prices may have exceeded fundamentals - which may include Australia, Ireland, Spain and the UK - there is a danger that higher interest rates could trigger a much larger downward adjustment in house prices," the IMF said in a report that is to be included in its World Economic Outlook.
"Just as the current upswing in house prices has largely been a global phenomenon, any downturn is also likely to be highly synchronised across countries, with corresponding implications for the world economy," the IMF said.
Moving on up
Earlier this week, the US Federal Reserve raised its benchmark interest rate by a quarter of a percentage point to 1.75%, the third rise this year.
The Bank of England has raised interest rates five times since last November, most recently in August. Its key borrowing rate is currently at 4.75%.
Many analysts are now predicting that borrowing costs could continue to rise as the global economic recovery shows further signs of sustainability.
The Federal Reserve hinted on Tuesday that it would continue with its policy of small but steady rate increases, saying it will "respond to changes in the economic prospects as needed."
In the UK, the Bank of England is said to be mulling whether it has done enough to keep the rate of inflation within its 2% target.
"An increase in interest rates, as expected by futures markets, would slow down house price growth in the US and the UK; in the UK, a drop in prices cannot be ruled out."
The problem is that not only is the world becoming a more interdependent place, but it seems that the correlation between house price growth and economic performance also is becoming stronger.
"Changes in house prices influence demand and output by affecting households' wealth and capacity to borrow," the IMF said.
"Likewise, changes in economic activity, reflected in households' employment and disposable income prospects, can move house prices."
A significant drop in global house prices could, therefore, have a far reaching effect on the global economic environment. .
"The strength of the housing market has played an important role in supporting activity during and after the downturn," the IMF said.
"By the same token, the outlook for the housing market will play a key role in shaping the extent and nature of the recovery going forward."
Maybe, maybe not
The IMF is careful to point out, however, that it is not predicting that prices are set to fall.
All it is doing, it says, is highlighting imbalances and the areas which would be hardest hit should prices fall.
"Since the mid-1990s, many industrial countries have been experiencing a boom in housing prices, unusual in both its strength and duration," the IMF said.
"Moreover, despite the bursting of the information technology bubble and subsequent global downturn, the momentum of the housing boom has continued almost unabated."
"This boom has been associated with a very dynamic housing market and record-high levels of mortgage debt."
"The impact of rising interest rates would be significant - especially in the UK - but manageable."
In the US, the IMF said it "does not find compelling evidence suggesting that a real house price drop is in the offing".
By contrast, "the growth rate of real house prices in the UK is forecast to slow down significantly, and a fall in real house prices cannot be ruled out."