It's going to burst hard and really burn a lot of people.
The market is out of control here in Philly, people are paying $300k for houses that were selling at $30k only 4 years ago...
I have seen alot of friends buy a $400k house and are only making $150k a year at best. How they can sleep at night and be comfortable with that much overhead is beyond me. $3,000 a month is WAAAAY to high for a mortgage payment. Dont forget Car notes + kids + lifestyle...
I bought a $97k house in 2001. 3 bed / 2 bath that has 2000 sq ft. I have dumped close to 100k in rennovations into it that I paid cash for as I went along but the mortgage payment is still only $901. The house next to mine that had nothing done over the last 15 years is listed at $200k.
Buy cheaply and live within your means. These people overpaying are going to get burned hard when the market bottoms out. It happened in the late 80s here in philly.... houses were 100k one year and $20k the next.... Now these places are $200k and the old timers are cashing in like mad on the younger folks that have no basis in reality when it comes to buying a home.