The bottom line is that buying real estate with less than 10% down and a non-amortizing loan is pure speculation.

I have bought two homes with VA nothing down loans.  In both cases I technically came out ok, though in the second one I just sold in Nov. 2005 I had to bring 9K to the table to help pay for the new Septic I was ordered to install.  So in that case 10% down would have helped.