"Clearly, 50 or 100 basis points more on mortgage rates is enough to matter. It effects what people can afford to buy," says Bill Cheney, chief economist at John Hancock Financial Services .
The swift percentage point rise in mortgage rates cuts the purchasing power of a borrower by about 10 percent, he says.
Sometimes when rates turn higher the housing market actually benefits because buyers rush in before rates climb any further. But that doesn’t seem to be happening this time around.
"Employment is still bad, wages are still low, interest rates are up. That's going to hurt the housing market," Cheney added.
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Trader disclosure: On June 10th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Macke Is Long (USO), (AGU), (SKF); Najarian Is Long (AAPL) Call Spread; Najarian is Long (FCX) Calls And Puts; Najarian Is Long (JPM), Short (JPM) Calls; Najarian Is Long (PALM) Call Spread; Finerman Is Long (NOK); Finerman Is Short (USO); Terranova Is Long (RIMM) And Short (RIMM) Sept. Calls; Terranova Is Long (MS) And Short (MS) July Calls; Terranova Is Short (XOM) Call Spread; Terranova Is Short (FCX) And Short (FCX) Puts
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