Homeowners are struggling to sell their properties due to persistently high mortgage rates, making many feel 'locked in'. Nearly two-thirds of potential sellers have delayed their plans for over a year, with a significant number waiting even longer. This situation stems from the disparity between current rates, over 6%, and the lower rates many homeowners secured in the past few years. This 'lock-in' effect is significantly restricting inventory levels in the housing market, complicating the situation for potential sellers aiming to buy another home.
The holding pattern feels all too familiar as homeowners wait out high mortgage rates, hoping for some relief, says Realtor.com senior economic research analyst Hannah Jones.
Half of those who have a mortgage have reported feeling "locked in" because of the elevated mortgage rates stuck in the mid-6% range.
Simply put, if a homeowner who took out a 30-year fixed mortgage in January 2021 at the record-low rate of 2.65% decided to sell their home now, they would be forced to contend with the current rates.
The anticipated trajectory of mortgage rates is no small matter for would-be sellers, given that the majority of them are planning to buy another home in the future.
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