Agree with brian. The degree and quickness of change matters as well.

Say you’re considering a mortgage balance of 700k. 1% increase is $583/month. Not chump change, but if it happens slowly over 1-2 years, raises and inflation will offset much of it.

Now say there’s a panic in the dollar due to sovereign debt concerns, and like Greece/Ireland, interest rates shoot up to 12% overnight. Then you’re probably f’ed if you’re trying to buy/sell at that specific moment. But if that happened, I would suggest sellers would delist, not wanting to take a sudden 200k hit.

I personally think a panic in the dollar is possible but still low likelihood (less than 10%). It would destabilize most of the world, and everyone knows it. If it does happen, the US will certainly ramp up the presses overnight and print to high heaven to offset it, which would decrease the impact of debt balances.

I think it is more likely that we will increase our pandering to/protection of foreign governments in the near term, in exchange for implicitly buying faith in the USD.