Naturally, that is the big time question in property market now. . .

What is the likelihood the much talked about real estate bubble blow up similar to the dot-com bubble did not too long ago?

There appear to be some valid facts on both sides of the issue. Whatever develops in the next few years, it will impact all homeowners of Americans, and hence also tons of families on global basis. Should the bubble does "blow-up" as some say, it is certainly the world could, or more likely would, experience a period of recession. A deep one. Right now the real estate business has been a main contributor that the market has been holding its own lately. It has been one among a handful of stable and bright areas of our economy.

Primarily, to equate the property sector with the dot-com industry is unfair. It’s confusing apples with oranges. The property business has been and will always be a major part of the US economy. The real estate will not evaporate and there will invariably be a need and demand for accommodation. Owning property will be beneficial in long term. However, the dot-com bubble was not based on anything more than greed. Numerous businesses were trading on the stock market for huge amounts of money and never made any gain and ultimately never would.

So for me, some of the arguments is this: "Well, the stock market had the dot-com boom and then it collapsed, so now we have this property market boom so naturally it will fall flat as well." I just don’t agree with with that statement. Once again, property and dot-com are totally different sectors and business. Heck, if we can splurge $20,000, $50,000 and even near to and exceeding $100,000 on automobiles, then putting down $300,000, $1,000,000 or even more on homes seems very reasonable. Home will always be there so long that the mortgage is paid and the taxes are up to schedule, too. That leads us to a valid conclusion for thinking the property market will gradually decline and potentially have a downturn.

The reason there is a reasonable conclusion for the opinion that the property business will have a major downturn is as certain people, maybe quite an amount of homeowners, won’t be able to sustain with their mortgage mortgage payments if they start losing their incomes and the market declines. The hike in gas prices could have a crucial effect on the market and when these owners start keeping up to their loan schedule then this would flip the industry around.

Many property owners and speculative property investors are employing what some would call high risk property mortgages, an interest-only and no-income quallification mortgages. These encourage more owners to acquire more homes and are part of the reason the property business has experienced such a growth recently. Creative money supply originated a long time ago and has up the ante in more and more creative offerings for the home buyer and speculator to achieve what they desire. This is a good situation as a whole I figure. Still I can see the risks of this trend invariably. I don’t think a burst is unavoidable but it is without a doubt very possible. Perhaps more than likely, unless a drastic event like another war or a serious epidemic, is a soft landing and chipping off the value of the property market.

There are doom sayers on the side of the inevitable crash landing theory, who are gearing up for for the worst. Just as cartain investors can make gain on the stock market even when it goes soft, there are those who are preparing for a probable – inevitable in their minds – downturn in the real estate industry.

Following is one such method to take advantage on a property bubble blow-up or at least a downturn: pre- foreclosure deals. There are some investment clubs that are founded entirely on waiting for this to come off and then speculating into this business. Families will be foreclosing in record numbers if this downturn comes. Perhaps it is more precise to say when, because as history demonstrates there are always downturns in the market; and with all the creative financing, no interest loans and no income verification loans the chances of a downturn is likely. Still, this is different than a "burst."

So below is what can happen:

1. The business will keep going the direction it has in recent years, which is up, up and up. Quickly in some areas. Not likely.

2. The industry will slow down and taper off soon. Very possible.

3. The industry will have a minor downturn and a great many will lose their properties and another great many will gain from this. Very possible.

4. The sector will "burst" the "bubble" and there will be a huge meltdown in the industry. Possible, but not as likely as 2 and 3.

Regardless what turns out, there will be people who are ready for it.