Home prices and construction are set for a banner year in 2022, riding on the back of historically low interest rates and strong demand for work-from-home space, according to Susan M. Wachter, Wharton professor of real estate and finance. That could change, however, if prospective home buyers resist higher interest rates and rising home prices beyond a point, she said. Wharton Business Daily: How much of an impact would interest rate increases have on the home-buying and home-selling market this year? They see the possibility of interest rates rising, and they want to buy sooner rather than later. Deceleration is likely in housing prices this year, from over 20% to double digit, but 10% or lower on average.