The Christian Science Monitor has this report on the housing bubble in Massachusetts. "More than one-quarter of Boston's mortgage-holders appear to be stretched thin financially, spending at least half their income on housing, according to an analysis of census figures. That's more than twice the national average and the highest of any major city except Miami."

"The number of homes sold in Massachusetts dropped a whopping 21 percent in January compared with a year ago, the largest year-to-year decrease in monthly home sales in a decade. As a result, home values have begun to soften. Statewide, they actually fell slightly in January compared with a year ago."

"Such pressures are forcing a rising number of homeowners to erase their debts by forfeiting their homes. Foreclosure filings in the county that includes Boston nearly doubled in January from a year ago. 'Homeowners 'call us and are heartbroken,'" says Robert Pulster, (who) works with Boston residents on the brink of losing their homes. 'They thought it was their dream.'"

"More trouble lies ahead, some experts warn. 'I would suspect that as home prices soften, you are probably going to see a ramp-up in defaults, delinquencies, and foreclosures,' says Nicolas Retsinas of Harvard University. 'It is not that they were not stretched before, but if you couldn't make the mortgage payments, you would sell. If the market is softer, it is not as easy to do this.'"

"'This is the first decade that we have had this culture of pricing risk in home lending,' says Susan Wachter, professor of real estate at the University of Pennsylvania. 'What happens if someone loses a job? If you are already spending 50 percent of your income toward a mortgage, there is no cushion.'"

"The number of homeowners with mortgage trouble is rising, says Saul Perlera, who owns a real estate firm in East Boston. Some were scammed by lenders, he says. Others were too quick to buy. 'A lot of them just do not listen. They want a house,' he says. 'I try to advise them: You can get a house, but you might not be able to stay in it.'"

Other experts say not to worry. "'The air is coming out of the balloon,' David Lereah said, who argues a balloon is a better metaphor than a bubble to describe a market he characterized as going through a temporary price correction rather than a collapse. 'The bubble is not bursting. The solid fundamentals in our economy will keep the real estate expansion alive,' Lereah told about 250 real estate agents at the New England Realtors Conference."

"Lereah said predictions of a housing bubble are based largely on data showing a widening gap in personal income growth compared with more rapidly rising housing costs. He said such comparisons ignore the fact that interest rates remain historically low despite recent increases, putting monthly mortgage payments within reach of most consumers. 'You have mortgage rates below 7 percent,' Lereah said."