As the Federal Reserve ponders the now age-old question — when to taper mortgage-backed securities and Treasury purchases — it is likely to find itself facing two conflicting issues: rising rates, which impact newer homeowners, and the fact that refinancing still dominates the purchase market. CNBC explains the ongoing conflict:

"Those who can afford to upgrade or buy a second home are doing so, with private equity and hedge funds bolstering transactions. But the average American is still cleaning up their balance sheet, using cheaper 30-year fixed mortgages to refinance. Insiders say the balance between those taking out mortgages in the purchase money market to buy properties versus refinancing is far from healthy, with a skew to the latter.

Others not on the property ladder are having hopes of home ownership dashed as interest rates and prices climb. Many now hand over a regular rental cheque to the likes of Blackstone, the biggest owner of single family homes in the US."