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According to home builder Lennar's executive chairman Stuart Miller, rising home prices and interest rates are a "one-two punch" to homebuyers.

Home builder stocks are also being affected, as both the iShares Home Construction and SPDR S&P Home builder exchange-traded funds are both in bear markets. Indeed, Lennar's shares decreased 31 percent annually. In an interview with CNBC's Diana Olick, Miller argues that the perceived value is detached from the underlying fundamentals of the company, "We certainly believe it's an overreaction. Not one we didn't anticipate, as well, because the stock market does react to the home builders when interest rates start going up."

Labor costs are rising, too, "It exacerbates what is the affordable housing crisis we feel across the country right now. Very hard to deliver affordable housing with costs going up," Miller said. But with a labor shortage comes higher wages, and with higher wages come wealthier buyers. Although there is a ceiling as to how much Lennar can charge on homes, Miller said they can benefit from "pent up demand that's going to come to market even while prices are going up." He also emphasized Lennar's size and scale in local markets as a strength.

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