According to NAR's most recent housing report, home sales are NOT being dampened by mortgage rates. In 2013, home sales actually rose to the strongest levels they've been in 7 years. You can read the full report and find out more about this topic in this week's Realtor Snapshot by clicking the photo below.
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(Note that the information on my Realtor Snapshot page is updated weekly. Therefore, if the link does not display the correct information you are looking for, please contact me and I will email you the full report.)