Make no mistake about it, those who will benefit most from the rising rate environment will be the ones who have piles of cash. I didnt run your numbers AN but I do agree with your premise, the only comment I may throw in is that the 120k used to put down for the 600k home is now used for buying the 500k home so the buyer is coming in with a bit more cash to lower the balance a bit, but you may have already accounted for that.

The higher rates will help drag pricing down but pricing will FOLLOW the rates and that rubber band is a few months at least and not instantly. I am thinking over a longer term rates will be in double digits but that will be a ways out I believe.

Your illustration is very useful though. The moral of the story is if you are waiting to pounce when prices dump due to high rates, make sure you have a nice pile.