Home rates, deal or no deal?

Interest rates are down below 2.9% today as I write this, and  its a great but are you really getting the best deal, it depends on who you ask.
Here in Las Vegas house were selling like hot cakes, we were once again in a bidding war and they are saying its a housing shortage. My question is this, is it really and if so, will and if the market crashes what happens to the price of homes because there will be a flood of foreclosures.

Now this is what I see, yes if you could get into a home its a great thing especially at a great interest rate but there are a couple of thing you need to look at. Because the rates are low everyone may not qualify for it, it depends on your credit of course FHA is the way to go.  I look at and listen to both sides of the coin,  the 1st side is yes I'm going to get a low rate but a much smaller home for my money so in the future will I be upside down because at some time the rates will rise. You will then have  people who may not want a smaller home at a higher rate.

Let's take an example.. I pay $300.00 for a home that in normal situations would give me a home at about 2300 a square foot average.  Today with low rates it would be about 1700 a square foot, so now you  have sacrificed  footage for a rate, is that smart?  I'm not saying not to buy I'm telling you what's going on.

You need to think about this and why and ask yourself, is this your 1st home and are you a 1st time home buyer, are you single and how long will you stay in that home? There are reasons to buy such as it may be better then renting an apartment and maybe your going to rent it out later making an  additional income, in that case your as they say golden. Remember home purchasing is something that is suppose to start you on your way  to wealth.** You never buy the highest priced home on the street and intend to make money when you sell **   Some people might think, I got a great rate "lol" but did you get great footage that's my question.  

So to sum it up let me know if you think because the rates are great are you getting the best deal.