Industry NewsMortgage

Real estate tells tales of impending bubble

Industry concerned over interest rates, increase in home values

Real estate broker Vince Landolna has a theory about the housing bubble debate: Due to high housing costs, San Francisco Bay Area home buyers are seeking out affordable housing elsewhere. They're turning their attention east towards California's Central Valley. Now, these lower-cost areas are inflating wildly, pricing out local residents. The escalated housing values won't be a problem as long as homeowners are making enough money to afford the increasing mortgage payments. But if increases in household income can't keep pace with escalating housing values, then watch out for the real estate bubble and the resulting foreclosures. Landolna's prognosis came from a recent Inman News opinion survey that asked readers their opinion on the housing bubble debate. Despite recent stories in which real estate professionals were still upbeat about the market and unconcerned about rising interest rates, the survey results showed people definitely are worried. Real estate professionals fear the m...