Who's at Most Risk from a Bursting Bubble?

1. Home Owners with Little Equity

2. Home Owners with Adjustable Rate Mortgages

3. Anyone Who Must Move - If you have good equity in the house you certainly have the ability of selling it and moving on. Home owners who have high equity after living in a home for some time might be sorry they didn't sell when prices were high, but they can typically sell without a loss. Home owners who made a hefty downpayment, bu bought during bubble growth, will take a hit if they can't wait for values to come back up.

Common Sense Bubble Tactics
Keep your overall debt load as low as possible to help you manage an unplanned move
Use equity funds to increase your home's value, not buy luxury items Try to buy a home with good resale potential. Pay attention to your local market. Watch sales trends and read what your local and regional experts have to say about a potential real estate bubble in your area, but keep in mind that even the experts don't agree on where, when--or if--the bubble will burst. If it does, just hang in there, because over time real estate is a great investment. Prices will rise again.

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