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Homebuyers feel locked out as prices soar and mortgage interest rates hit new highs

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In the housing market today, it feels like what goes up doesn’t have to come down.


It looked like home prices were finally cooling off late last year after price spikes that began during the pandemic. Nationwide, prices dipped gradually in the second half of 2022 as mortgage rates climbed in response to rising interest rates. And some areas where a lot of new homes had been built — like Austin, Texas; Boise, Idaho; and Charlotte, North Carolina — saw significant price declines.


Granted, that was a double-edged sword for many people. Higher interest rates tend to bring home prices down, but that’s because they make it more expensive for buyers to borrow money to finance their purchases.


The rate hikes were not enough to undo the big price gains of the past few years, especially in parts of the U.S. where home sale prices already run well above the national average, but the change came as a relief for many people.