US Federal Reserve (Fed) Chairman Alan Greenspan said on Saturday that the red-hot housing market will eventually cool down, making some Americans feel less wealthy.

Speaking at the end of a two-day economic conference in Jackson Hole, Wyoming, he said that the US housing boom "will inevitably simmer down." "As part of that process, house turnover will decline from currently historic levels, while home price increases will slow and prices could even decrease," he said.

As a consequence, people taking cash out of their homes through refinancing, selling or other financial arrangements will ease along with "some of the strength" in consumer spending, Greenspan said. However, he said that the estimates of how much consumer spending will ease differ widely. Greenspan also cautioned Americans on Friday against thinking the value of their homes and other investments will only go higher,saying "history has not dealt kindly" with that kind of optimism.

The US housing market has been red-hot in the past several years and home prices are rising quickly these years resulting mainly from the declining mortgage rates.

Source: Xinhua