The main driver of the slowdown is rising mortgage rates. The average rate on the 30-year fixed mortgage, which is by far the most popular product today, accounting for more than 90% of all mortgage applications, started this year right around 3%. It is now just above 6%, according to Mortgage News Daily.

That means a person buying a $400,000 home would have a monthly payment about $700 higher now than it would have been in January.

If the prices of homes has increased and the interest rates has increased in the housing market. How does this affect the demand? How does this affect supply since home buying has slowed down.

use specific economic vocabulary within demand, quantity demanded, determinants of demand, shifts in demand curve, likewise with supply.

Thank you,