The current (rapid) rise in mortgage rates – an average of 5 percent last week, the highest in a decade – will undoubtedly give pause to those would-be sellers who are currently paying less than 3 percent.

On the other hand, analysts point out that higher rates will also limit demand, which means homes will stay on the market longer, giving buyers more options from which to choose.

Already effects are being seen: some sellers are reducing their asking prices while mortgage purchase applications declined 6 percent compared to last year.