Recently there have been concerns and speculation voiced about a "real estate bubble".

A real estate bubble can be caused by speculation driving property values up, above what the incomes of the area can sustain. It is usually followed by a decrease, or leveling off in value.

The media has created a buzz correlating the "real estate bubble" with rising mortgage rates. However, the housing market is determined by the job market and not rates. If people feel like they're jobs are in jeopardy, they will be less reluctant to buy homes even with low mortgage rates. Conversely, if rates rise and people feel secure with the job market, they are more apt to buy homes even though the monthly mortgage payment might be slightly higher.

Every city has different real estate and financial trends, what is happening in New York may not be happening in Milwaukee! Before you buy any real estate you should first find a good realtor and a good mortgage broker to help guide you down your path to ownership!

Even buying in a real estate bubble isn't necessarly a bad thing. Not all real estate bubbles burst, some simply cool down and level off with no depreciation in value.

If you are considering getting cash-out equity of your home you should consult with a mortgage professional and real estate professional to consider the market-value of your home with respect to your new total mortgage balance(s). Going "upside down" on your mortgage is a real happening, and could prevent a homeowner from selling or refinancing in the future if it occurs. Make sure that if you are considering an over-equity 2nd mortgage (e.g. 125% 2nd mortgage) that you have a real long-term plan to deal with it financially so you are not stuck with misfortune.