Rising rates might slow the pace of home price gains. Inventory levels may however be an even bigger driver of home prices. A shortage of inventory could drive prices higher even if rates cool some of the demand. As rising prices encourage sellers to list homes and more inventory comes into the market, however, prices should begin to cool.

RELATED STORIES:



-- Written by Shanthi Bharatwaj New York.

>Contact by Email.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.

If you liked this article you might like

Housing Stocks Fall as Fed Leaves Rates Unchanged

Housing Data Drives Down Homebuilding Stocks

Strong Housing Numbers Boost Home Construction ETFs

5 ETFs to Buy if You Like Lowe's Fourth-Quarter Earnings