Home sales are up by 10 percent and prices up by 6 percent nationwide, CNBC reports. But the heat won’t last once mortgage rates rise, says Redfin CEO Glenn Kelman.
Analysts expect the Federal Reserve will begin raising interest rates in September. Based on past trends, potential buyers pullback when there is a mortgage rate spike, like what happened in late 2013, when demand declined about 10 to 20 percent.
"We do not see consumers willing to pay that price when rates go up. We think there is going to be a step back as the money supply tightens," Kelman tells CNBC.