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Americans have, so far, stood resilient to rising mortgage<\/a> rates, but a bigger impact will come soon, say Goldman Sachs economists.\u00a0<\/p>\n Read more<\/strong>: Mortgage Rates: Is It a ‘Year Full of Surprises’? <\/span><\/p>\n<\/blockquote>\n Housing\u2019s share of the economy rose above normal levels from November to January, despite mortgage rates surging 60 basis points at the time.\u00a0<\/p>\n Still, economists caution that there may be a lag to the impact of rising rates and particularly their effect on home prices. In an analysis\u2014pulling data from past 100-basis point increases in mortgage rates\u2014economists found that the median home price<\/a> often drops 3 to 4 percent. \u00a0<\/p>\n \u201cThis median estimate suggests that the recent 60 basis point rise in mortgage rates should, all other things equal, lower house prices by 2 to 3 percent,\u201d the Goldman analysts concluded. \u201cThis estimate thus supports our forecast that national house prices will continue to rise, but at a slower pace in the next few years.\u201d<\/p>\n That said, buyer demand is much stronger than supply at the moment and the economy and job growth are continuing to support the housing<\/a> market.\u00a0<\/p>\n \u201cThe housing market is also in a more virtuous cycle: Home equity has recovered, mortgage rates remain low enough to be manageable, and high rents make homeownership attractive,\u201d MarketWatch reports. \u00a0<\/p>\n Many economists are skeptical whether mortgage rates will actually rise much more than they already have. A survey conducted by MarketWatch in December 2016 showed an average for rates of 4.5 percent throughout 2017, a 35 basis point increase from current readings.\u00a0<\/p>\n Source: \u201cHere\u2019s How Home Prices May Respond to Rising Mortgage Rates,\u201d MarketWatch (March 7, 2017)<\/em><\/p>\n<\/div>\n<\/div>\n [ad_2]\n
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