More Homeowners Move Off Sidelines, Accepting 6 Percent Mortgages

Nearly 20 percent of U.S. homeowners had mortgage rates of 6 percent or higher in the second quarter, the highest level in a decade.

A 'For Sale' sign in Washington. Madalina Vasiliu/The Epoch Times

The number of U.S. homeowners whose mortgage interest rates are at least 6 percent rose to nearly 20 percent in the second quarter, the highest level in the past decade, online real estate brokerage Redfin reported on Sept. 29.

Mortgage rates have hovered stubbornly above 6 percent since September 2022, when the average rate for 30-year fixed mortgages climbed to 5.34 percent after hitting a record low of 2.96 percent in 2021.

Since then, though, the share of homeowners whose mortgages were issued above 6 percent has steadily risen about 1 percentage point each quarter for the past two years, Redfin reported. Average mortgage rates peaked in 2023 at 6.81 percent, the highest average annual interest rate since 2001, the Mortgage Reports found.

Mortgage rates are expected to remain elevated for at least another year, Redfin analysts said. Rates held steady within a range of 6–7 percent for much of 2025 and dipped to 6.13 percent in mid-September ahead of the Federal Reserve’s long-anticipated 25 basis-point rate cut on Sept. 17. Rates then ticked back up to 6.38 percent for the week ended Sept. 26, according to the firm.

High interest rates have largely stymied home sales and mortgage refinancing, especially for homeowners who bought or refinanced their homes during the period of historically low rates in 2021–22, the Federal Housing Finance Agency (FHFA) said. Homeowners whose mortgage rates are well below current market rates are essentially “locked-in” and aren’t inclined to move or sell their current homes, the FHFA found, with each full percentage point below current market rates representing a nearly 20 percent decrease in the likelihood of selling.

According to Redfin, somewhat more than 80 percent of homeowners have mortgages with rates below 6 percent, and 52 percent have mortgages under 4 percent. However, an increasing number of homeowners are adjusting to the new normal of elevated mortgage rates, especially as the supply of new homes rises, said Chen Zhao, Redfin’s head of economics.

“More homeowners are deciding it’s worth moving even if it means giving up a lower mortgage rate,” Zhao said.

“Life doesn’t stand still—people get new jobs, grow their families, downsize after retirement, or simply want to live in a different neighborhood. Those needs are starting to outweigh the financial benefit of clinging to a rock-bottom mortgage rate. As a result, more homes are hitting the market than we’ve seen in years, giving buyers a wider range of choices.”

There were 1.09 million active listings in the United States in August, the Federal Reserve Bank of St. Louis reported. By way of comparison, there were just 346,514 listings in February 2022.

Nationwide, pending home sales jumped 4 percent in August, the National Association of Realtors (NAR) reported. Year-over-year home sales were up in four major geographical regions, led by the Midwest with a 6.7 percent increase, the NAR found.

Lawrence Yun, chief economist for the NAR, said the slight easing of mortgage rates has allowed more homeowners to go under contract, especially in the Midwest.

“Low mortgage rates combined with high levels of affordability are attracting more buyers compared to other regions,” Yun said.