And by worst they really mean best. Lower housing cost means better life for more people.
It depends why they are lower. If they are lower because more houses are being built that could be a good thing because relieving the chronic shortage in affordable housing will help more people get on the property ladder, increase the available labour pool for businesses, if they live closer to work it will ease transport congestion, etc, etc. Good all round.
However if house prices are falling because wages are getting depressed so people can't afford higher prices, the jobs market is slowing, inward investment is petering out, etc then it's not so much that lower house prices themselves are bad, but it's a really bad sign for the economy.
Apart from anything else, falling house prices due to economic factors is going to reduce investment in new housing, which we really do need in the medium to long term.
And even though it only directly effects the most expensive property, it ultimately lowers prices for a lot of houses due to the inelastic nature of housing demand.
More generally, whilst lower property prices are generally a good thing for the economy, a property price crash and the resulting economic instability is unequivocally a bad thing.
Edit: yeah, OK, you can't buy a mansion in zone 1 for £1m. I'm going on my own internal standard, i.e. if it's over £1m it better have turrets.
1 Million will buy you a 3 bedroom flat in Zone 1.
Don't forget all these charts provide averages across all central London areas - some more real-life examples:
A terraced house in Earls Court cost you about £150-£200k early 1990 - now £1.5M+ - similar in Fulham etc.
A double fronted house in Worlds End (now considered to be part of Chelsea) was about £350-£500k at the same time - now about £4-6M.
Many people working in central London until about 20years ago bought themselves property from bonuses - these properties (first time buyers) were mostly used for self-occupancy - now there are very little bonus payments for younger people working in the City and a large proportion of people working in offices in London commute between 2-4h each day (when the 9-5 becomes 5-9).
Now (since at least 6 years) most property is cash-bought - i.e. no mortgage was taken out. You are looking mostly at "investment buyers" and with these, prices are far more sensitive to changes like the Brexit. Look around in central London and you will realise how much residential property is actually empty - for some of these "investment buyers" it is cheaper (tax) not to rent and the government is not doing anything about this since many years.
Most property development - to my knowledge - is now "to-rent" vs. "to-buy" - what we are seeing is a reversal of policies supporting people (latest Thatcher) to become property owners back to pre-WW2 when only the rich could afford not to rent.
On current central London price level you will have to have best at least £500k cash for a down-payment and then earn at least £200k p.a. to be able to pay your mortgage for a family size property.
In terms of empty property, this is what the Land Value Tax is good for (especially in C London, were most of the house price is for the land). Its a shame the Lib Dems never win general elections.
But back in 1990 interest rates were a whopping 14% - that means that a 25 year mortage would have cost the equivelent of £4935 each month.
Today that house is worth 1.5 million. The same 25 year mortgage at today's interest rates would be £5158 a month.
So really house prices haven't changed that much, it's just that the money is going to different places.
If you don't piss off homeowners today, tomorrow situation will become even more dire. Pricess will be bigger, price growth expectations would be even more insane, regular people will be more disgruntled. So it should really be "piss early, piss often". Or face downward spiral.
It's pretty obvious how this should resolve: suppose there's two nearby towns (inside metro area) - one is building up but another one doesn't. Property prices will lower in both of them but onle one will be getting economic benefits, leading to second one following the suit. It only becomes problematic when cartel forms, blocking the development of entire area. Such cartels should be fought with.