By Brian O’Connell Rising interest rates are cutting into the housing market, forcing experts to consider an unpleasant possibility. It’s not a matter of “if” but a matter of “when” the housing will lose its luster, and residential real estate prices will decline. In fact, evidence is emerging that the downward trend has already started. “In the US, mortgage applications have fallen by 28% from their peak, new home sales are down by 17% and housing starts have dropped by 13%,” said Neil Shearing, chief economist at Capital Economics in a new research note. “A similar story is playing out in th…