• The average rate on the 30-year fixed sat just below 4 percent a year ago, after dropping below 3.5 percent in 2016. It just crossed the 5 percent mark, according to Mortgage News Daily.

• While more people think now is a good time to buy a home, according to a monthly sentiment survey from Fannie Mae, more people also think mortgage rates will go up.

• Higher rates could throw cold water on those high home prices, as sellers see demand fall off and their houses sit on the market longer.

Millennials are in their prime home buying years, and they’re used to cheap credit. So they might be in for a rude awakening as mortgage rates jump.

The 30 year mortgage rate just crossed the 5 percent mark, according to Mortgage News Daily. That is the first time in 8 years, and it is poised to move higher. Five percent may still be historically cheap, but higher rates, combined with other challenges facing today’s housing market could cause potential buyers to pull back.

While more people think it is now a good time to buy a home, according to a monthly sentiment survey from Fannie Mae, more people also think mortgage rates will go up, meaning they may want to buy now and happily lock in the current mortgage rate.

Home sales have been sliding for much of this year, and total annual sales are expected to come in lower than last year. Affordability is the clear culprit. With rates now more than a full percentage point higher than a year ago, that adds at least $200 more to a monthly mortgage payment for a $300,000 loan. It also knocks some borrowers out of qualification because lenders are strict on how much debt a borrower can carry in relation to his or her income.

The stronger economy has definitely fueled demand for housing, but the last few years of near record-low supply pushed prices too high too fast. So while more consumers may want to become homeowners, more and more simply can’t afford it.

My take is that today’s mortgage rates are still historically attractive, but it may take a while for the market to get used to this level. In the meantime, many higher end homes are cutting prices significantly in an effort to sell them. The new tax law putting a ceiling on the property tax deduction was a kick in the teeth to those that own a home with a high property tax bill. Hopefully, growing take home pay from a robust economy and lower tax rates will more than offset the cap on the tax deduction and higher mortgage rates. I believe it will in time and this may turn out to be a great buying opportunity for some.

Remember your home is where you live first and foremost, an asset too, but know that the value will fluctuate and can go down in value, especially when mortgage rates go up.