help or advice appreciated - re bubble

Hi

Need some ideas or feed back for a friend. Only a young man in his early 20's married with 2 children.

He bought a unit for 260,000 in 2008 -(first home buyer) and owe's about 185,000k on that unit now. 2 bed 1 bath in Toowong QLD 4066.

The neighbour sold may this year for 326,000 and only difference is that the neighbour has polished wooden floors in the unit and this one is carpet. Last 3 sales for the block are $326,000 in 2011, 313k in 2010 and 323,000k in 2007 and his 260,000 in 2008 - an alright buy at the heart of previous gfc. He has moved out and is renting a 3 bed room house because his wife had another baby and renting the unit privately for 350 weekly including utilities.

Now in terms of this MASSIVE bubble you speak of - is it likely prices will go back to that of 92'? He is not sure to hold or fold to buy a bigger house at lower prices.

Keep in mind the previous owner purchased the unit for 92,000 in 1992.

Bear or Bull please step up to the plate with a polite logical solution !