Will Higher Mortgage Rates Stifle the Housing Market?

San Francisco Real EstateHome prices have been soaring over the past year, the sharpest gains in seven years; construction activity is picking up nicely. Both trends have been driven in no small part by a steady drop in home mortgage interest rates, which have made homeownership too good a deal to pass up for millions of Americans.

But the trend on rates has reversed abruptly in the past few weeks. This chart shows the average rate on a 30-year fixed-rate mortgage since the start of 2011; the spike on the right shows an increase from 3.4 percent to 4.1 percent since May 1.

So what will become of our precious and long-awaited housing boom? Is it a fragile, delicate flower about to be crushed by the boot of higher rates? Or is the housing recovery now resilient enough that there’s no need to fear? Economists at Goldman Sachs have run some numbers through their models of how the housing market works and have come up with some promising answers.

At Gay Realty Watch, we look for news to share with you about the gay real estate market – both lgbt real estate news and news specific to gay and lesbian real estate meccas.

Authored By Ezra Klein – See the Full Story at WonkBlog

Click here for gay realtors, mortgage lenders, and other real estate professionals.

If you have a gay real estate story that you’d like to share with us, contact us at [email protected]