Housing Sales

According to an Associated Press story published in the Boston Globe this week, rising mortgage rates will have only a marginal effect on the nations hot real estate market. Even though mortgages rates are expected to continue rise during the year, most economists believe the increase will be gradual leaving the housing market in good shape. In February sales of previously owned homes fell slightly but new home sales leaped by close to 9.5%. Many analysts feel rates could hit 7% by the end of the year. Doug Duncan, chief economist at the Mortgage Bankers Association said, “For me, it’s the speed at which rates rise that is important. If rates were to go up rapidly and pass 7.5% that would bother me”. In the final analysis, any cooling seen this year shifts the real estate market from “hot” to “very strong”.