Case-Shiller Index co-author Robert Shiller spoke with FOX Business Network (FBN) about his concerns surrounding the rising house prices. Shiller said that he believes some people have become “kind of trigger happy” and that “this might be the beginning of another boom,” but cautions that as a result “markets might be more volatile going forward.” Shiller further states that he thinks the housing prices “will probably go up at a modest pace,” but there is still a possibility “of declines.”

 Excerpts from the interview are below:

On whether the buying activity is related to interest rates:

“Well interest rates are at historical lows so that certainly is a factor. I think people have gotten kind of trigger happy, some people, thinking that this might be the beginning of another boom. In certain cities like Phoenix, I think that’s a factor.  And so I think markets might be more volatile going forward.”

On other markets experiencing a boom:

“San Diego and San Francisco have been hot. You know any city that went through a bubble before I think is at risk, including Miami. Once people get kind of get the speculative fervor they don’t necessarily forget it.”

On whether people have learned the dangers of volatile housing prices:

“I think people have learned something. They’ve learned that home prices can and do fall. Nobody doubts that anymore, I think. But still the idea of the reality that it could actually fall right now doesn’t impress people. People think – I don’t know why, but it seems to be the psychological that I am hearing that modest increases are almost assured. I think it’s more uncertain than people realize. We got this fiscal cliff, we got Europe, we got Asia there’s a lot of uncertainties out there and while I think it will probably go up at a modest pace there’s a real possibility still I believe of declines.”

On whether stocks or houses are cheaper right now:

“I think the stock market beats the housing market in my estimation right now – it’s all uncertain though, anything like this is very uncertain.”