Sure. Anyone running a pricing model and not considering refinancing costs for marginal sellers—and financing costs for marginal buyers—isn’t describing reality. (Refinancing dynamics are heavily studied.)

> also a zoning and policy effect, of course, but it’s a mistake to think that mortgage rates do not inversely influence transaction prices

Nobody said they don’t. Just that the effect isn’t meaningful compared to zoning. The monetary hypothesis seems predicated on the effects of rates on home prices being symmetric, i.e. if low rates caused prices to go up, by enabling buyers to borrow more quickly than builders could borrow and build, high rates should do the inverse. But symmetry isn’t required in economics, e.g. wage stickiness.

There are a bunch of reasons why monetary policy didn’t flow through to pricing. We can debate that fruitfully. What shouldn’t be debated is that it hasn’t. Raising rates won’t fix this problem because it hasn’t. Fixing zoning will. (Do we even have an example from abroad of a housing crisis being fixed with monetary policy? Versus directly manipulating supply and/or demand?)