When you think about the fact that interest rates were down around 3 percent at the end of last year and today the 30 year fixed is around 6.75 on primary residence, and although the prime rate has doubled, real estate values haven't really dropped as much as you would think yet. Obviously real estate values move slow and adjust slowly, but given a full year of quickly rising rates, i dont think im alone in saying the real estate market has held up well thus far... Although this largely plays into lack of inventory and lack of supply relative to base demand, its still impressive. Below is a chart of interest rates through the end of last year and how they fluctuated over the last 20 years. Using the chart below, a spike above the 6.9 - 7 percent level could be problematic, but for now, i think our housing bubble has softly deflated.