According to Hometrack, property prices in London have been going down for the last two years. We now wonder when the decline will come for the United States.

That property will go down we have no doubt. As for when, where, and how...we have plenty of ideas.

But no reasonable man cares how much his house is worth. He uses it to hang his hat, not to pay for his retirement. Besides, the average U.S. housing prices, compared to the rest of the world, do not seem extravagant. If you own a home in the rural mid-west, for example, and if you are happy with it, we would not sell it because of a coming correction in the property market. Forget about it. A house is not meant to be an investment; it is a consumer item. Enjoy it. Pay off the mortgage and sleep well in it, no matter what is happening to neighborhood property prices.

In some markets, however, such as Miami, Washington, Las Vegas and San Diego, the coming corrections may be so severe that you will wish you had sold. In Houston in the 1980s, and New York in the 1990s, prices fell 50% and more. It would not surprise us to see similar reversals for today's hottest markets.

Miami and Las Vegas have gone Mondo Condo...where thousands of units are being pre-sold in advance of construction. It is likely that not all those sales will actually be completed. Many of the buyers are not people looking for a place to live, but speculators hoping to make easy money by reselling once they are completed. Already there are signs of cooling off in the U.S. market. So what? But the speculator is not a reasonable man. He is driven wild by greed hoping to get something for nothing...and then, when he actually gets what he deserves, he becomes a desperado and a cad. If the condo doesn't rise in value, he dumps it like yesterday's girlfriend; she costs money and he has no further interest in her.

When the empty condos begin coming up for sale, the whole property could be in trouble.

When will this happen? We would guess the hour approacheth and soon will be.

"The King of Real Estate," we learn in the weekend news from CNN, has decided to get out while the getting is good. Tom Barrack runs the largest real estate fund in the world - Colony Capital - with $245 billion in assets. The fund is up 21% per year for the last 15 years, 17% after fees. Barrack's modus operandi is to buy classy properties at distressed prices, fix them up a bit, and then resell when the cycle has turned. Get it, dear reader? Mr. Barrack is not in the business of providing "sophisticated" financial products. His ploy is the old familiar one: Buy low/Sell high.

For example, he bought Tokyo's Fukuoka Dome - roughly equivalent to Houston's Enron Field (now called MinuteMaid park) - for a price he considered less than the value of the titanium in its retractable roof. He also bought the 3000-room Hilton Hotel in Las Vegas for $280 million, which is barely one tenth what it cost Steve Winn to build.

There's a time to build, and a time to buy, we conclude. The time to build is when you have a lot of money that you want to get rid of. The time to buy is when the builder has gone bust. That is Barrack's technique.

Builders have been running wild in many U.S. markets. Now is the time to sell, says Barrack. We'll get a chance to buy later...at much lower prices.

*** Darn! We have had our eye on the gold market...hoping to see the price fall back under our buying threshold of $450. The price rises in $25 steps, we notice. It spent most of 2005 around $425. The year before, it was around $375. In 2003, the price stood around $350. Each time it take another step up, we move our buying target up another $25 and hope the price drops takes a step back before going higher (And kick ourselves for not having bought more at last year's target price!).

Gold seemed to be getting ahead of itself recently, at prices near $470. So, we guessed that it would drop soon, but so far, the yellow metal has been reluctant to go down very much. Friday, the price rose $5.90. December contracts are still around $469. We still have our fingers crossed.

*** Our resident India expert, Sala Kannan, has this to share with us...

"Yesterday, I visited a friend who is going home to India on vacation next week. She was busy making appointments with a doctor, dentist and optometrist in Madurai, her south Indian hometown. Then she wrote a list of antibiotics, pain and fever relievers to buy in India. She carefully tucked the list into her handbag.

 "'Why?' I asked.

"Her answer was simple: 'They're cheap. They're good.'

"Cheap and good they are. Take Advil, for example. It costs about $4.29 for 20 capsules of Advil. The active pharmaceutical ingredient in Advil is ibuprofen. You can buy the same ibuprofen through a generic brand and pay $3.49 for 100 capsules. And 65% of all active pharmaceutical ingredients used in American generic drugs come from India.

"In fact, 22% of all the world's generic ibuprofen comes from a single southern Indian manufacturer called Shasun Ltd. That's a fifth of all the world's generic ibuprofen coming from a single Indian source!

"The Indian generic makers' motto is simple - in order to make money, don't be the first to make a drug, be the second. In fact, the 'copycat drug making' business is so established in India, generic drug maker Cipla Ltd. at one point had a generic version of almost every drug that Pfizer ever made!

Bill Bonner is the President of Agora Publishing.  For more on Bill Bonner, visit The Daily Reckoning.