First crack in housing bubble.

Yahoo! Finance had an article on Monday that I think was overlooked by many due to the holiday. They are reporting that the housing bubble is showing its first signs of popping. It's true that sales are still strong, even record-setting, but prices have begun to fall. The median price of a home fell in July by a whopping 7.2%. And the details paint an even more alarming picture of the staggering decline in the U.S. housing market. Since April, median home prices have fallen 14% ... They fell from $236,300 in April to $203,800. I wrote awhile ago about our search for a rental property for investment purposes, but after seeing a couple of duplexes, two flats and single-family homes, and their price tags, we decided to back off a bit. We are still searching for that "diamond in the rough", but we are in no hurry and are willing to wait for the market to cool. After running numbers on several places, we can't even come close to breaking even with cash flow, even including the tax-incentives of investment properties. Now is not the time to speculate in real estate. Simply put, your downside risk is greater than your upside potential right now. That's not to say that all markets should be avoided, but I would definitely be very, very careful and run a very detailed cash-flow analysis before purchasing any investment property right now. I know a lot of people are afraid of missing out on the red hot real-estate action, but fear is never a good reason to participate in an investment.