The Nation's hot real estate housing market bubble is not bursting, but is experiencing a flattening effect after three strong years of appreciation, according to a survey of real estate markets throughout America.

"Everybody can't be Donald Trump," said Henry Fishkind, a Florida economist. "I'd be cautious right now." Fishkind and other real estate analysts agree, saying the housing market has peaked in many areas of the nation, and in only some real estate markets do they see problems in the future.

"Miami is ground zero for the housing bubble," said real estate consultant Jack Winston. "It's going to be severe in Miami, and it's going to be problematic in West Palm. We've built too many units (condominiums) compared to the projections for real users."

Nearly 81,000 condominium units are under construction or in the planning stages in the greater Miami metorpolitan area, which represents the largest boom in Miami's history. Already, however, real estate agents are reporting price reductions and some buyers of units have backed-out of deals.

In the Florida panhandle in Panama City Beach more than 5,000 preconstruction condo buyers have either backed out of deals, forfeiting earnest money deposits or cancelled reservations for condos all together. Mortgage rates have increased and could hit seven percent this year, which would be enough to slow the housing market, according to Fishkind.

The lack of building supplies and higher costs will continue to effect development for the third year in a row, said Ken Simonson, chief economist for the Associated General Contractors of America.

Simonson agrees with National Association of Realtors economist David Lereah, who expects the housing market to decline just 1 to 3 percent during 2006.

Real estate markets have shown signs of change for many months in some local markets, transitioning from strong sellers markets to buyers markets.

In the nation's top 20 metropolitan markets housing has appreciated an average of 79% over the past three years, while the national average for all markets increased just 32% nationally, according to National Association of Realtors figures.

The San Francisco Bay area has seen some of the nation's strongest appreciation. An average home in the greater Bay Area is now $726,900. That's nearly a seven-fold increase over 1980 prices.

New York City's average for a single family home is now $506,800, twice the national average. Homes in New York have appreciated 47% in the past three years, setting an all-time record high.

But prices for homes and condominiums in many other places of the nation remain relatively low. An ailing economy and massive lay-offs due to business failures have contributed to an average housing price of just $142,500 in Houston, Texas. Houston's prices are 30% below the national average.

Kansas City, Missouri housing prices are also well below the national average. Single family homes in Kansas City average $257,100, some 20 percent below the average.

Back on the west coast, Los Angeles housing prices were in the doldrums during the 1990's, but prices have increased an astounding 66% over the past three years, due in part to pent-up buyer demand for properties. The average price for a home in the greater Los Angels metropolitan area is now $474,800.

In Phoenix, Arizona although prices have spurted up 44% in the past six years, the average cost of a home is still a relatively affordable, $243,400. Phoenix is one of the fastest growing cities in the nation.

Back in Miami, the average price of a home is $371,600, which is 80% above the national average. The real estate market was weak in the greater Miami metropolitan market in the 1990's, but has been catching-up in the past several years.

Smaller less urban markets have seen housing prices increase too, but not as significant as urban markets. The price for a home in Portland, Maine is now $247,200, a modest increase of just 21% in the past three years.

Real estate economists point to the fact that real estate markets are local in nature, and no single market is like another, separated by their own localized regional economy and other factors.

That's what Fishkind and many other economists are counting on to protect the nation's future housing economy from crashing.

The real estate bubble may burst in some local real estate markets in the next couple of years. Economists seem to be in agreement on that, but not in all markets.

About the author:

Mike Colpitts is the publisher of Real Estate Add, a consumer oriented real estate website, which keeps consumers up to date on local real estate market conditions in all 50 states. Visit http://www.RealEstateAdd.com