**Abstract**

The performance of the housing market is currently considered a measure of economic activity. This research explores the *connectedness* vs. *the ripple effect* hypothesis in the current house pricing literature. Using linear causality and nonlinear causality tests we show significant bidirectional dependence between the London house prices and other UK regions' house prices except for Northern Ireland and Wales in contrast to the existing literature where more evidence of ripple effect is reported. Furthermore, linear and non-linear forecasting tests back these results. This result has important implications for policymakers and investors.

**Keywords:** Connectedness, House Prices, Nonlinearity, Ripple Effect
