The main argument of the mortgage rate lock-in thesis is that listings of existing homes have fallen due to higher rates, but this isn’t the case, according to Pretium.
Active listings fell from 2019 to 2021 as mortgage rates fell and have been increasing since the beginning of 2022. The pace of transactions has fallen at a faster rate than the pace of new listings, driving up both overall resale listings and months of supply. Fannie Mae’s National Housing Survey asked earlier this year whether mortgage rates were a factor in homeowners’ plans to stay longer in their current homes, and the results “suggest that a fairly strong majority of mortgage borrowers’ future moving plans may not be affected by their mortgage rate.”
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