The Associated Press reports on Poland. "House and apartment prices in Warsaw and other leading Polish cities have spiraled upward, a boom driven by low interest-rate mortgages, housing shortages and foreign speculators snapping up real estate as investments."

"'The demand is generally driven by local people but there are buyers from Spain, the U.K. and Ireland buying new constructions in bulk; 10, 20 or 30 apartments and sometimes even more,' said Bogumil Rutkowski, a manager at a real estate agency in Warsaw. 'We've had a boom since the second half of 2003, but it's just been accelerating more and more lately.'"

"'The foreign speculators are pushing the bar up for normal buyers,' said Andrzej Halesiak, an economic researcher who has studied the issue. Some of the difficulty is offset by easily available low-interest loans, but most house and apartment hunters these days still grumble."

The Guardian. "First-time buyers risk over-stretching their finances by borrowing 3.24 times their income to buy their homes, the highest amount ever, it was announced today."

"The figures for July, published by the Council of Mortgage Lenders, follow a stark warning from Citizens Advice that 770,000 buyers in Britain had defaulted on their mortgage, and that 13% of 21- to 24-year-old homeowners had missed at least one mortgage payment in the past year."

The Sydney Morning Herald from Australia. "Falling property prices are always bad news for home owners, especially when they result in your home being worth less than you paid for it. When negative equity coincides with rising interest rates and record levels of household debt, as it does now, many households could find themselves in real trouble."

"David Bell says that in the past clients who got into financial bother with their credit cards or had trouble meeting their mortgage repayments could always sell their house as a last resort. 'There's a fundamental difference now, house values have dropped and people simply can't sell their home,' says Bell, who is a counsellor in south-west Sydney."

"Solicitor Katherine Lane agrees that negative equity is pushing more people over the financial precipice. 'The difference this time is that we all carry a lot more debt; it's a powder keg,' she says."

"The Herald reported a case last month where a house at St Clair, in Sydney's west, sold for $260,000, 42 per cent less than its previous sale price at $450,000 in 2003. This was a mortgagee sale after the owners could not meet the interest payments on the $405,000 they borrowed to buy the house. There was just one bidder on the day."

"Carolyn Bond, of the Victorian Consumer Credit Legal Service, reports a marked increase in calls from people facing court action to sell their house. Bond says fringe lenders are often to blame. Typically, these non-bank lenders provide short-term, interest-only loans which appeal to desperate borrowers unable to get credit elsewhere. Bond says many defaulters end up having their house sold within six months. 'If they couldn't pay their previous mortgage it's unlikely they will be able to afford this one,' she says."

"According to Australian Property Monitors, house prices have fallen by an average of 10 per cent since the market peak in 2003-04. There is wide variation, though, across the country and even within cities."

The Australian. "In the US and down suburban streets colourful political posters are popping up on front lawns. But there's something else competing for attention as you drive by: 'For Sale' signs. Lots of them."

"The US housing bubble has started to deflate and Australia's experience is a leading indicator. The headlines in newspapers across the US, filled with anxious quotes from buyers who bought at the top of the market, could be Sydney or Melbourne a year ago."

"Properties are staying on the market longer. Sellers are dropping their prices. The hot markets in metro areas up and down the west and east coasts, where home prices regularly fetch more than $US1 million ($1.33 million), are not just shaving tens of thousands of dollars off the price, but hundreds of thousands."

"It's worth remembering the US housing market has been one of the engines of the US and the world economy in recent years. Americans have used their houses as an alternative bank, effectively extending their mortgage to take advantage of the ever-increasing value of their homes."

"The contagion that follows a US housing bust are easy to understand: if there's less demand for Chinese goods, that in turn means less demand from the Chinese for Australia's raw materials. 'One of the things that might make it more difficult in the US, than in Australia, is that just as Australia's housing market was sinking it got a big lift with China and the demand for commodities,' adds economist Mark Zandi."

"'The underlying economy in America might not be as strong with the same sources of growth to replace housing,' he said."

"There is likely to be some belt-tightening. And if petrol prices stay high, it means the US consumer consumption model, which has helped underwrite global growth since the collapse of the dotcom technology bubble in 2000, is looking decidedly wan."