The Supply Response to House Prices Is a Dance Between Supply and Demand

As soon as house prices stop rising and maybe even fall a lot of the developers pull back. The main reason to buy a house is to get capital gains on the value of the house. So when you tend to have a fallen house prices that doesn't seem to find people to start to develop some of the land they have. But unfortunately at the moment we've seen large increases in interest rates that's pushing up the cost of servicing loans which is making it harder or tightening credit conditions for people to be able to invest in housing supply.