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Yeah, an interest-rate hike is possibly more concerning than a property market crash. Given that mortgage offers are stress tested, and I'm not maxing out my mortgage allowance, I'm kind of trusting/hoping/praying that I'll be ok.
Certainly if interest rates leap up, millions of mortgagees are going to be screwed, which probably would cause a property market crash — possibly even a multi-national recession a la 2008 — which is why the Bank of England will probably go to almost any length to avoid a sharp rise.
Who knows, maybe the combined efforts of the government/BoE won't be enough to hold off such a situation. Maybe we'll all be screwed. But I like to try and stay optimistic.
Diamond_Supercool
Would you be OK if interest rates went up, say 4%? Savings rate in the UK is very low and personal debt high, that could be a bigger issue than just a drop in value.