It’s no secret that interest rates can make a big difference for home buyers and just how affordable a home is.  When rates are low, which they have been for a long time (as of this post) buyers can afford a higher mortgage and a more expensive home.  The tradeoff is that when rates are low, home prices tend to increase as more buyers can afford homes.  When interest rates go up it tends to slow down the real estate market and prices flatten or even decrease.  See the infographic below to see how small changes in rates can make a big difference with monthly payments.