According to Fleming, over 90% of homeowners who refinanced during the pandemic have locked in a mortgage rate below 6%.
“As mortgage rates return to a not-so-new-normal of over 6%, those homeowners have a financial disincentive from selling, keeping a lid on the primary source of housing supply, and you can’t buy what’s not for sale,” Fleming explained.
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Still, recent rate increases combined with high home prices continued to discourage many potential buyers. The median price of existing homes rose 1.9% annually to $406,700 in July.
“Most homeowners continue to enjoy large wealth gains from recent years with little concern about home price declines,” Yun said. “However, many renters are concerned as they’re facing growing affordability challenges because of high interest rates.”
Source: mpamag.com