Low-rate mortgages keep U.S. homeowners in place

Mortgage costs are giving many U.S. owners a powerful reason to stay put. The average rate has reached 7.4%, a peak not seen in three years, while 49% of fixed-rate borrowers pay less than 4%. Moving to a similarly priced property can therefore produce a larger monthly bill. That gap is delaying relocations for households whose homes no longer fit their needs.

Today’s imbalance traces back to unusually cheap pandemic-era financing. The typical 30-year fixed rate stayed under 3% between July 2020 and September 2021. Those loans remain widespread: a record 43% of active mortgages are 5 to 7 years old. Just 28% originated during the four-year span ending in June 2026, when higher borrowing costs reduced new loans and refinancing.

Realtor.com expects this lock-in to last into next year. It estimates that mortgages carrying rates of at least 6% will represent 27% to 29% by mid-2027. The earlier share was 23%, measured during 2026’s second quarter. Lower market rates could ease moving costs and bring more sellers forward, but the stock of cheap loans is changing gradually. September showed some adjustment: the average home price declined 1.4%, while the supply of listings increased slightly.