Typically, high mortgage rates slow down home sales, and home prices should soften as a result. Not this time. Home sales are certainly falling, but prices are

Typically, high mortgage rates slow down home sales, and home prices should soften as a result. Not this time. Home sales are certainly falling, but prices are still rising—there just aren’t enough homes to go around. Before the Fed started raising rates, a person with a monthly housing budget of $2,000 could have bought a home valued at more than $400,000. Today, that same buyer would need to find a home valued at $295,000 or less. It is still not clear what started this. There has always been a shortage of rental housing, but homes were selling with low interest rates five years ago. Home sales are slowing so there is less inventory in the marketplace, would that not lead to a higher price for those homes? I am trying to understand if the increase in interest rates caused this imbalance in the housing market, the pandemic, or some other restriction on homes being built, bought, sold etc.