The warning by the Consumers' Association that newcomers to the housing market should not over-extend themselves when taking out a mortgage deserves to be heeded.The repercussions of the huge boom and bust in the British property market in the late 1980s and early 1990s is still being felt as thousands of mortgage holders continue to suffer what is euphemistically called "negative equity" - that is, having a house the market value of which is less than the value of the mortgage. Here, many people are putting themselves at similar risk by getting caught up in the current property market hysteria: they fear that if they don't buy now, prices will be even higher six months or a year from now, yet this simply fuels the demand for more houses and raises house price inflation.Unfortunately, it wouldn't take too much to prick and possibly burst the property balloon - a rise in interest rates, the abolition of mortgage interest tax relief, a widespread introduction of a genuine property tax, an international stock market crash or currency crisis, a war or natural disaster.And while none of these is likely to happen in the short term - especially since EMU membership should inevitably mean a slight drop in interest rates - Saddam Hussein is back in the news and Tokyo is overdue its earthquake. (The Germans may very well raise their interest rates after EMU is established, with automatic consequences here).With average mortgage purchases in the £60,000-£70,000 range, a 1 per cent rise in interest rates would account for an additional £60-£70 payment per month. Borrowers should take into account that it also means a higher output for other personal loans and overdrafts.The trend has developed whereby first-time buyers not only raise 90 per cent mortgages from their banks, but borrow with separate institutions at higher interest rates to meet the cost of the down payment and stamp duty.The Consumers' Association of Ireland has recommended that first-time borrowers, who are caught in this inflationary cycle consider whether they could maintain a mortgage in the even that their personal situation was to change - as a result of redundancy, illness or starting a family. Such people should consider staying in rented accommodation.Existing mortgage holders should also take heed of the Consumers' Association warning of an overheated property market and not only consider extending their existing property rather than trading up, but also accelerate their capital repayments in order to increase the proportion of their house which they own - as opposed to what the bank or building society owns.