The recent ups and downs of mortgage rates and home sales are expected to carry over into the new year.
If rates undergo another radical shift, the turbulence in the housing market will continue, according to real estate experts. Consistently, however, interest rates move the opposite direction of demand from homebuyers.
“Particularly if we see a pretty quick rise – maybe a half a percentage point to percentage point rise — it’ll make for some bumpy demand in 2014,” Ellen Haberle, an economist at online brokerage Redfin, told the Wall Street Journal.
The seasonally adjusted annual rate of new home sales fell by 4 percent month-over-month in May, while mortgage rates climbed, according to the U.S. Department of Commerce. Five months later, new home sales rose 18 percent month-over-month, while rates dropped by less than 1 percentage point. [WSJ] — Mark Maurer