I’d happily deal with a higher interest rate that could be refinanced to a lower interest rate some time down the line, but home prices need to drop. Mediocre houses selling for a half million when they should actually be around $350k is probably scaring people off more that a 6.5% interest rate.

That rate honestly isn’t even bad. People just got used to artificially low rates after the 2008 crash, but that’s what it was prior to the housing market collapsing. But paying that “high” rate on top of an overvalued mortgage because investors and house hunters who all have endless cash want to turn everything into a rental property so they can pay whatever price for whatever house? And regular joes have to compete with that? That probably scared people off more than anything.

I’m not paying a half million for a 1500 sq ft ranch that’s in the suburbs. Regardless of interest rate.