At a time when some home buyers should consider expressing economic caution, they are buying ever more costlier homes, but without additional financial strain on their incomes, yet.

Rising incomes and easy-access to low-interest mortgage rates allowed home buyers to pay 6 percent more for their homes in 1997 than they did in 1996, without straining their housing budget more than they did in 1996.

U.S. home buyers paid an average $164,500 for a home last year, up from the $155,100 average in 1996. The monthly payment rose to $1,130 a month, up from $1,080, but both years housing cost homeowners only 31 percent of their income.

That's because the average monthly income rose from $3,500 in 1996 to $3,700 in 1997, easing the burden of the higher mortgage.

"Affordability was virtually unchanged despite loftier price tags," according to Brian Bragg editor of U.S. Housing Market's October newsletter report, "Americans Buy Costlier Homes, Incomes Allow Bigger Payments."

The news should give some home buyers cause to pause and take stock, especially if you live out West where today's peaking market hearkens back to memories of the last great boom.

Many buyers who purchased at the top of the market in the late 1980s and early 1990s survived a recession that caused home values to crash by as much as 40 percent. For years many brave homeowners braved a mortgage they could barely afford and now, nearly a decade later, they are just enjoying enough appreciation to sell at a profit.

Other's weren't so lucky as "short sale" became an industry catch phrase.

"Now is the time to apply lessons learned from this go-go boom time and the letdown that followed. Many who suffered them had optimistically purchased toward the end of the upswing and were left holding the bag, with high mortgage payments and decreased equity," wrote Debra Bernard, president of Walnut Creek, Calif.-based Bernard Marketing Associates. The firm provides sales, marketing and management consulting to builders, developers, banking and other real estate clients in the West.

Indeed, U.S. Housing Markets optimistic report shows California cities among the most expensive, with San Francisco at the bottom of the affordability list, followed by Los Angeles, and San Diego. As a state, California was the least affordable.

Mortgage payments were highest in San Francisco, New York, Boston, Los Angeles and San Diego, to round out the top five. Payments were cheapest in Tampa Bay, Pittsburgh, Kansas City, Greensboro and Miami-Ft. Lauderdale, according to U.S. Housing Markets.

Still there's hope for anyone who wants to buy a home, provided they take certain precautions, cautions Bernard.

"A focused buyer can buy a home anywhere and end up feeling good about the decision," she said. How?