Why Homeowners Are Letting Go of Low Mortgage Rates

For years, one number has quietly dictated the rhythm of the housing market: the mortgage interest rate. When rates plunged below 3% in 2020 and 2021, millions of Americans wlocked in historically low payments. It became the financial equivalent of a golden handcuff — keeping people planted in their homes even when life started nudging them forward.

But something is shifting.

According to a recent Redfin report, 17.2% of homeowners with a mortgage now have rates 6% or higher, the highest share in nearly a decade. Meanwhile, 21.3% are still holding on to sub-3% rates. That gap is narrowing — and that tells a powerful story about today’s market.

While it’s tempting to view mortgage rates as the deciding factor in every move, the truth is simpler: life doesn’t stop moving just because a number on paper looks good.

People are growing their families. They’re downsizing. They’re relocating for career opportunities. They’re seeking better school districts, more walkable neighborhoods, or simply a lifestyle that aligns with where they are now—not where they were three years ago.

For many, the value of living the life they want outweighs the appeal of staying put to protect a low mortgage rate.

Over the past two years, the “lock-in effect” — homeowners staying put to avoid trading their 3% mortgage for a 6% one — has cooled the housing market. But this data shows that more Americans are deciding that waiting indefinitely for rates to fall isn’t a strategy.

In fact, rising inventory in some markets is creating opportunities that simply weren’t available during the ultra-competitive frenzy of the pandemic housing boom. Buyers who make a move now are often finding:

• Less competition for their dream home
• Negotiation power that wasn’t possible in 2021–2022
• A chance to refinance later if rates come down

A mortgage rate is a powerful financial factor, but it’s not a life plan. The “perfect” interest rate doesn’t build memories, give kids more space to play, shorten your commute, or put you closer to the people and places that matter most.

For many, moving now — even at a higher rate — aligns better with their real life than waiting for a theoretical perfect number.

The data shows that people aren’t just making financial decisions; they’re making life decisions. Yes, mortgage rates are higher than they were a few years ago. But that hasn’t stopped families, professionals, and retirees from stepping into their next chapter.

If you’ve been sitting on the fence because of your rate, you’re not alone. And it may be time to ask: is your current mortgage keeping you comfortable, or is it keeping you stuck?