More than 95% of American mortgage borrowers pay less than today’s market rate, and 65% pay at least 2 percentage points less, a legacy of the mass refinancing of 2020 and 2021, when rates hit record lows. In a note published Monday, Goldman Sachs economists say that gap will keep the housing market stuck through 2027, with just 3.9 million existing-home sales, 26% below 2019 levels. The note does not mention millennials, but its findings bear on the split inside that generation.
The main reason for the diagnosis by Goldman economist Ronnie Walker is “lock-in.” Moving would mean giving up a cheap loan for an expensive one.
