With mortgage interest rates having risen a full point over the last two months, there has been a lot of renewed talk about how interest rates will affect the housing market. We talked about this recently (Déjà Vu: Mortgage Interest Rates Panic), but I thought now would be a good time to post a collection of related posts I’ve written over the years on the subject.
- What the Heck is the Affordability Index, Anyway?
- The Monthly Payment Buyer
- The Consequences of a Market Full of Monthly Payment Buyers
- Interest Rates vs. Home Prices
- Do Rising Interest Rates Lead to Falling Home Prices?
- The Curious “Logic” of Home Salesmen
Summary: Interest rates have a large effect on affordability, and many if not most homebuyers base their sense of how much home to buy on what monthly payment they can afford, but in the end there is only a very loose relationship between interest rates and overall home price trends.