Mortgage Rates Rise Fuel Housing Fears

Rates on home mortgages continued their upward march this week amidst inflation concerns to their highest point since September. While some see the rise as an incentive to dive into the already murky housing markets, others believe this could do further damage to the housing market.

"The day of low interest rates is over," Dan Seiver, an economist at San Diego State University said, speaking to SignonSanDiego. "Because of inflation, we'll be having interest rate rises cross the board. But having rising mortgage rates in the current real estate environment is like pouring water on a drowning man."

With the Fed trying to stave off the threat of inflation, an increase of half a percentage point could add more than $100 to monthly mortgage payment. Essentially, the higher the monthly payment, the higher the likelihood of delinquencies which would also be a deal killer for any prospective homebuyers.

For those in the market for a home, they now face a conundrum: Do you wait for the market to reach rock bottom before buying your home - by which time interest rates may have sky rocketed? Or do you buy now with moderately priced interest rates and watch as your home's value depreciates over the next couple of years?