Homeowners nationwide continue to feel the mortgage “lock-in effect,” with many choosing to stay put rather than trade low pandemic-era rates for today’s higher monthly payments. A Realtor.com report found that this lock-in effect is mainly felt in expensive coastal markets, leaving homeowners “frozen” in terms of mobility and inventory growth.
According to the publication, the typical U.S. mortgage holder pays about $1,300 in principal and interest per month. But if they were to purchase a home today, that payment would increase by more than 73% or $1,000. Across the U.S., 80.3% of existing mortgages have interest rates under 6%, including nearly one-third (32.1%) locked in at 3% to 4%.
