We’ve known for some time that seller-buyers in the U.S. are feeling the lock-in effect of their lower mortgage rates.
And now, there’s a survey to prove it.
Realtor.com® published the results of a new survey conducted with HarrisX that shows 82% of those looking to buy and sell a home feel “locked in” to their low rates.
More than half of them (56%) plan to wait until mortgage rates come (further) down, while 25% need to sell their home soon for personal reasons.
This may be the best time of the year to sell your home. But today’s mortgage rates are considerably higher than the current rates most homeowners have. And for those who don’t need to sell—or don’t want to badly enough—that’s enough reason to stay put.
Here’s what you need to know.
SELLERS ARE ALSO BUYERS
According to the Realtor.com-HarrisX survey, 86% of those intent on selling their homes in the next 12 months also plan to buy a new home. And since most of those seller-buyers will be signing up for a new mortgage—with a substantially higher rate—their new home purchase will likely put additional strain on their budgets.
For those with enough equity to buy down the mortgage rate and reduce their monthly payment, this will be less of an issue (to say nothing of those who can make an all-cash purchase). But for many potential seller-buyers, it’s forcing them to think twice about selling in the current market.
One positive aspect that came out of the pandemic was historically low mortgage rates—and many people took advantage of this opportunity to buy their first home, upgrade to a more expensive home or refinance the home they were in. Unfortunately, this comes with a bit of a catch-22, as homeowners who locked in a 30-year fixed rate in the 2-3% range don’t necessarily want to give that up in exchange for a rate in the 6-7% range.
Danielle Hale - Realtor.com® Chief Economist
SILVER LININGS FOR HOMEOWNERS (ESPECIALLY BOOMERS)
Boomers take up the largest share of homebuyers in today’s market. And this generation is more likely to sell after they’ve purchased their next home.
Boomers are the runaway leader in who’s actually listing their homes this year…So, not concentrating your listing marketing materials on the Boomer pool because you think they’re phasing out is a huge mistake. And I will tell you explicitly, Boomers are gonna be in the game for the next 15 years.
Byron Lazine
(Boomers are) least impacted by the rates, they’ve got a ton of equity in their current homes. They have…the desire and the ability to live the lifestyle that they want. And so, it makes them an insanely powerful demographic.
Lisa Chinatti
Posted by:
BAM Staff
Apr 21, 2023
