Mortgage rates are steering both supply and demand in today’s costly environment. When mortgage rates fall, mortgage applications increase and home sales increase. A four-month long decrease in mortgage rates pulled many buyers back from the sidelines to take advantage of the brief improvement in affordability – with rates dipping and home values falling across parts of the country. However, potential sellers have been slow to list – many wanting to hang onto their lower-rate loan. With fewer homeowners choosing to list their homes this spring, new home sales are continuing to increase. There were 436,000 new houses for sale last month – the lowest since April – suggesting that builders still likely face challenges in completing units while buyer demand has also ticked up.