Takeaway: New mortgage lending drives house prices up by injecting fresh purchasing power into the market, while loan repayments push prices down by destroying money, revealing that bank balance sheets actively steer real estate cycles. Key Points Credit Creation Lifts Prices: A boost in new mortgage originations acts as a temporary injection of fresh purchasing power that creates a lasting upward shift in house prices. Credit Destruction Cools Prices: Paying down mortgage pr

Home prices rose 20.6 percent in March from the same time last year, but will rising interest rates take the punch bowl away from the party?