Some things have changed little in the past 19 years, with Kylie and Madonna both still topping the charts, as they did back in 1989. Now homeowners are growing increasingly concerned that a much more frightening similarity may emerge between 1989 and 2008 - a house price crash.

In 1989, house prices started to fall in the first year of what turned into prolonged house price correction. Prices fell 11 per cent in 1990 alone, according to figures from Nationwide Building Society.

Hundreds of thousands of people lost their homes, unable to keep up their mortgage payments. Many were left in negative equity, as the sharp downturn in prices meant that their property fetched less on the market than they had paid for it.

Economists who believe that there are cycles in the housing market highlight the similarity between the rise in house prices in the late 1980s and the stellar increase over the past nine years. Most homes have more than doubled in value since 1996.

However, recent house price falls have indicated that the party is over for homeowners. Nationwide said that prices fell 0.5 per cent in February - for the fourth month in succession. The credit crunch has effectively accelerated the slowdown.

The stark difference between the top of the housing market in 1990 and today is interest rates. In the late 1980s, interest rates rose to 15 per cent as the Government tried to curb spiralling inflation.

These measures were not enough to stop inflation hitting 10 per cent in late 1990, by which time the economy had actually reversed into recession.

In comparison, today's interest rate of 5.25 per cent is modest, and the Bank of England is widely expected to make further cuts this year.

There is another difference in interest rate-setting. In the early 1990s, the Government could not cut rates aggressively to boost the housing market because it was trying to make sterling attractive as the UK entered the European exchange-rate mechanism.

Today, the Bank is less constrained than the Chancellor was then over scope to respond to the impact of falling house prices. Yet the Bank still faces conflicting pressures, with its ability to bolster growth through lowering rates hampered by entrenched inflation.

The pressure on homeowners' pockets is broadly similar to that in 1989. Mortgage payments ate up an average of 65 per cent of take-home pay in 1989, and just over 50 per cent now, figures from Capital Economics show.

There is one big difference, however. Whereas arrangement fees for mortgages in the 1980s were minimal, fees today often exceed £1,000.

This time round, it is unlikely to be soaring interest rates that cause difficulties. Instead, the end of the low-cost easy credit years is likely to be the turning point. After years of offering very competitive deals, mortgage lenders are getting tougher.

They have found it difficult to access funding since the credit crunch, and this has made them pickier about the loans they offer.

In September last year, first-time buyers with no savings could get a mortgage to cover the full price of a property. Those who had no money for furnishings could get an additional £30,000 loan.

Just five months on, many lenders are refusing to lend to people lacking a 5percent deposit, and increasing numbers of lenders are looking for a 10 per cent downpayment.

Homeowners are also affected by these changes. Those who have not built up significant equity in their home will be forced to remortgage on to more expensive deals, as the most competitive rates are reserved for those with a significant stake.

Last month, Nationwide said that only those with 25 per cent equity would be offered the best mortgage deals.

Sue Anderson, of the Council of Mortgage Lenders, said: “There are a number of factors depressing the housing market. Tightening lending criteria and a reduction in the availability of funding generally is one of these.”

As people struggle to get mortgage deals, they stop buying property, causing the housing market to stall. There is evidence of this starting to happen. Mortgage approvals for new home purchases fell by a third in January, compared with January 2007.

A slowdown in activity in the housing market leads to a fall in prices as sellers seek to attract buyers by dropping their prices.

Add to this mix an eye-watering rise in personal debt, and the increasing pressures on homeowners and buyers become clear. Borrowers had racked up just over £50 billion in unsecured debt in 1990. This has now increased sixfold to more than £220 billion.