Greenspan has said some areas in the U.S. have a housing froth. I think "froth" means a lot of small bubbles. Others just say there is a housing bubble. Regardless of how the housing market is characterized, it seems likely housing prices will plateau if not decline in areas where appreciation has been greatest. When the peak will be reached in a particular area, however, is anyone's guess.

I'm thinking about buying a house worth about 25% more than the one I now own. My current house is mortgage free, my income is secure, and I can pay cash or finance the more expensive house. Price appreciation has been phenomenal in my area, and we may have a bubble or one in the making. While I would not be risking financial ruin by moving up, I wonder whether I should buy now or wait for a bursted bubble. I also wonder whether I should finance (rates are attractively low) or pay cash.

I realize Forum members are not fortune tellers, and can't tell me with certainty what is the best thing to do. However, I would appreciate your thoughts.