Sort of, the bigger problem in the US is that the US market is short something like 6 million houses due to zoning rules. Volume is going to dry up significant

Sort of, the bigger problem in the US is that the US market is short something like 6 million houses due to zoning rules. Volume is going to dry up significantly, and prices will go down a little bit - but there won't be a deluge of forced sellers like there were in 2008 because most people are on long-term fixed-rate loans. The majority of sellers will be divorcees and estates, as individuals chill in their 2.625% APR 30y fixed's - or own their homes outright. Unlike 2008 we're not coming off a deluge of building, quite the opposite - and unlike 2008, most people don't have 5 houses on variable rate debt. tl;dr: Prices will go down a bit, but the market is so short housing, it won't really matter. Longer term anyone who buys at 7% APR will just refi down when rates drop - and probably cash-out refi at that.