Industry News

Rising rates may bust real estate boom

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The rise of interest rates is the single factor most likely to end the current housing boom, according to an informal Inman News survey. Asked, "What single factor is most likely to end the current housing boom in your area?" about 55.1 percent of respondents said rising interest rates, 23.6 percent said rising home prices, 6.7 percent said natural disaster or terrorist attack, 5.6 percent said the current housing boom will not end, another 5.6 percent said other factors were most likely to end the housing boom, and 3.4 percent said there is no boom in their market. An "auction mentality on the part of buyers and agents," stagnant or declining employment numbers, declining purchasing power, and an ailing local economy were also cited by respondents as possible factors that could end the housing boom. Michael Blomquist, president-broker of Michael Scott Properties Inc. in Los Gatos, Calif., said, "I am amazed at the ease in lending practices. This recovery reminds me of being stuck...