There is no clear cut answer to this vexing question. If one were to compare it to the stock market bubble, one can clearly see a similar rapid increase in prices. Essentially, a lot of money poured into the stock market and made it reach an unsustainable price point. The case with property markets may be similar, with soft home mortgage loans having been available for several years.
However, home mortgages are backed by pieces of real estate and critics feel that any similar crash can be ruled out.
Real estate is not like stocks, where, with a slight fluctuation, a lot of trading can drive the price in either direction quite rapidly. People do not buy and sell their homes just because prices are expected to fluctuate. Conversely, prices stay stable, if people do not want to buy and sell real estate like stocks.
Effectively, we can say that real estate markets may be overheated, and one may expect gradual correction in the prices, but a bubble like crash is unlikely.
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