I've noticed that in Phoenix, Arizona, the market is growing rapidly
thanks to the low rates and ease of finding approval for loans.  When
rates return to normal, or increase slightly to offset the unexpected
period of lows, how will this affect the purchase of Real Estate in
the New Home Market?

When rates go up, is it expected that less will buy as a result of
high rates?  New Home companies often compensate for prices by adding
incentives such as landscaping, pools, etc.  Is it expected that an
increase in incentives will keep sales moving at the same speed, or
are things expected to slow down to compensate for market conditions?

I very much want to work in New Home sales, but fear that much like
the dot coms, the worst case scenario will prevail and everyone will
lose their jobs and die of starvation.  Though this fear is more
extremist than it need be, I'm still trying to guage the effect of
higher rates effectively so as to begin finding ways to live with
them, should they come back and with a vengeance.  If a salesman is
making 50,000 a year and fits in the middle as the "average", any
ideas on where he stands as rates climb towards and perhaps reach,
double digits?  Do New Home Builders (Fulton, Continental, KB Homes,
etc.) usually implement any safeguards from preventing high rollover
due to low sales?

Appreciate the help,
retsim

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Clarification of Question by retsim-ga on 11 Jul 2003 11:43 PDT

One quick addition.  I'm well aware that in the sales industry,
there's an 80/20 rule applied.  The use of an "average" salary was
only to give a baseline for any willing to apply an adjustment based
on things that cannot be fixed by the salesman.

An example would be a decrease in the amount of homes available for
sale, increase in time spent "in limbo" regarding placement in new
developments, or as agents are often employees - layoffs.