Sent in by a reader, in which the Wall Street Journal ask, Housing: Is It Time to Buy?:

There is, of course, one wild card that could affect most markets: rising interest rates. A big surge could pose a risk by making homes less affordable. Rates for a 30-year fixed-rate conforming mortgage spiked to 5.13% on Feb. 14 from 5.04% a week earlier, according to the Mortgage Bankers Association.
View Full Image


Since then, however, rates have fallen back below 5% on jitters over the Libya situation.

The best-case scenario might be that rates rise in 2011, but very slowly. That “should encourage people to act soon, before rates get any higher,” says Guy D. Cecala, CEO and publisher of Inside Mortgage Finance Publications Inc., a Bethesda, Md.-based provider of residential mortgage data. In San Francisco, for example, “Rates were going up [in 2010], but it was good because it pushed people to buy,” says Alan Mark, founder of The Mark Co., a residential real-estate consultant there.

Confusing though the various statistics may be, they do point to one overarching conclusion: Now is a good time for upper-income buyers in most markets to start looking.

My answer to the question, is now the time to buy a house? Is “Maybe.” Depending on your situtation.

Interest rates matter and inflation matter.