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Everyone agrees: Even higher rates won't impact affordability

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A panel of esteemed housing experts speaking at the ABS East 2013 conference underway in Miami disagreed on Robert Shiller's recent call that U.S. housing is in a bubble.

Moderator Howard Esaki, managing director at Standard & Poor's, who himself puts out regular morning emails encapsulating finance news, played a video on Bloomberg of Shiller talking of a housing bubble.

Shiller co-developed the S&P/Case-Shiller Composite-10 Home Price Index and actually said housing was looking bubbly. His words were later moderated in a column in the New York Times.

The panel elaborated on whether or not U.S. housing is actually in a bubble. No one believes it is.

Mark Fleming, chief economist of CoreLogic, said price appreciation is slowing down, and is only correcting for an overshoot in price collapse. He didn't think it would return to the inflated pricing before the housing bust.

"We are certainly not in a housing bubble," said Laurie Goodman who heads up a housing thinktank at the Urban Institute. Both Goodman and Fleming said housing could absorb higher interest rates and remain attractive. Goodman posited that even with a 6% interest rate, affordability would remain at 2000-2003 levels, which were pretty stable compared to 2006-2007.

"I don't see interest rates going to 6% any time soon," she added.

Esaki then addressed the crowd at ABS East, where attendance is at a record high (3,500+) with an estimated 1,000 investors, according to data released by organizer Information Management Network.

Esaki asked for a show of hands: "Do you think there is a housing bubble?"

Not a single hand went up.

Later an audience member pointed out that "no one raised their hand, so maybe we are." The devil's advocate then sat back down and the panel moved on to talk about the slim chance of near-term GSE reform.

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