In the late 1980s, the "now or never" scramble to get a foot on the property ladder fed a frightening cycle of rising house prices.

This summer, there are five buyers for every house on the market, the shortage being fuelled by a rush to snap them up before they go.

The Bradford & Bingley has reported that sales have significantly speeded up: a third of all new properties are now being sold within three weeks.

Many buyers are young first-timers, buoyed by the lowest interest rates in 30 years.

Surveys by lenders the Halifax and Nationwide show that cuts in interest rates since October, which have brought down typical mortgage rates from 8.95% to 6.85%, have lifted buyers' confidence.

Nationwide reports that house prices increased by 7.3% in the first three months of this year and prices are now growing at an annual rate of 10%.

Earlier this month, the Halifax said property prices had seen their largest jump in six years thanks to low mortgage rates.

The boom is self-perpetuating: when owners know they can sell easily, they wait until they have found somewhere to buy before putting their own home on the market. This exacerbates the shortage of homes on estate agents' books - fuelling demand and price rises.

It's all beginning to sound familiar.

So is the bubble going to burst again, like last time? Is a crash inevitable?

Gazumping groovy

Over the past year, house prices have climbed by 5.7%, with the national average house price reaching £75,576, compared with £71,480 in May 1998. The strongest rises were in the south of England, particularly the highly-populated Greater London area, where prices rose by 10% year-on-year.

As interest rates have sunk lower, "hoovering" - buying to let - has swallowed up substantial proportions of property, another factor in the vicious circle of demand-outstripping-supply.

Meanwhile, the dreaded practice of gazumping has been on the increase again.

Last week, solicitors were working on the conveyancing of a small three-room house in central London, after the sale had been agreed at £550,000. But within hours, the agent took a call from someone who had earlier rejected it and put in an offer £15,000 higher. As contracts had not been exchanged, the new offer went to the vendor - and was accepted.

These are typical symptoms of an overheated market.

Thirty years ago, an average UK house cost just £4,600. Now, it costs fifteen times as much. Average prices in the South East over that time have jumped from £5,700 to £102,600.

But long-term indications do not point to a bust to follow the mini-boom.

Burned fingers

The Halifax said it believed the sudden rise was a one-off. Economist Martin Ellis said: "We are not looking at the beginning of a property boom as seen in the 1980s, but now is a good time to buy a house as mortgage rates are competitive and there are plenty of discounts to be found."

The Royal Institution of Chartered Surveyors says a variety of factors are different now:

• the abolition of double mortgage relief brought a frenetic market to a halt last time
• 100% mortgages were easy to get in the 1980s
• now lenders rarely offer more than three or four times a salary - less than before
• the house price-to-earnings ratio is relatively low now, making property still affordable. In the 1980s, the ratio was five-to-one

RICS spokesman James Rebbeck said: "When the chancellor announced the abolition of double mortgage relief, the market went absolutely mad. Anyone who had been planning to buy, did so immediately. The day after it ended, the market stopped dead.

"The recession of the early '90s and the psychological impact of repossessions had a deep impact. A lot of people had their fingers burned. People are much more cautious now - lenders are more wary and ask borrowers to stump up more cash," says Mr Rebbeck.

"Also, there's still no real evidence that people are buying houses to resell for a quick profit. And people are still realistic about prices - overpriced houses just aren't selling, whereas in the '80s, owners would get an estimate then add 30%."

And although properties are being snapped up quickly, the number changing hands has not reached the level it did 10 years ago - 1m a year at present, against 1.9m a year in 1989.

There is no guarantee that any further base rate cuts will be passed on to borrowers - so the mini-boom may not last.

Chelsea estate agent Andy Buchanan says the last crash was exacerbated for owners because the rental market was strong.

"When the selling market is weak, the rental market is traditionally strong, because if you can't sell, you let your property out. Now, the rental market is softer because so many tenants are buying," says Mr Buchanan.

Any potential bust is also being fended off by large numbers of people coming to the UK to buy. Mr Buchanan's office, John D. Wood, is registering 1,000 buyers a month - 50% up on last year.

"They are coming for all sorts of reasons - mainly business. There's a backlash against trying to make Frankfurt the banking centre of Europe and big banks such as Credit Suisse are sending people here. People also come for high standards of medical treatment and education."

North-South divide

As they flood in, another north-south divide is emerging. According to the Bradford & Bingley, the areas most in demand this summer are in the south.

Analysts at Cambridge Econometrics have already predicted the number of people moving house in the North is likely to decrease this year.

It also estimates that prices in London will rise by about another 5% a year in the long term. Even in London, it seems, the "now or never" scramble never really meant much.