Don’t Let Home Prices Headlines Fool YouSpend about 5 minutes online searching for news about the housing market, and odds are you’ll see something pop up about home prices. You may even
Are More Homeowners Selling As Mortgage Rates Come Down
Dated: January 26 2024
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Are More Homeowners Selling as Mortgage Rates Come Down?
If you’re looking to buy a home, the recent downward trend in mortgage rates is good news because it helps with affordability. But there’s another way this benefits you – it may inspire more homeowners to put their houses up for sale.
The Mortgage Rate Lock-In Effect
Over the past year, one factor that’s really limited the options for your move is how few homes were on the market. That’s because many homeowners chose to delay their plans to sell once mortgage rates went up. An article from Freddie Mac explains:
“The lack of housing supply was partly driven by the rate lock-in effect. . . . With higher rates, the incentive for existing homeowners to list their property and move to a new house has greatly diminished, leaving them rate locked.”
These homeowners decided to stay put and keep their current lower mortgage rate, rather than move and take on a higher one on their next home.
Early Signs Show Those Homeowners Are Ready To Move Again
According to the latest data from Realtor.com, there were more homeowners putting their houses up for sale, known in the industry as new listings, in December 2023 compared to December 2022 (see graph below):
Here's why this is so significant. Typically, activity in the housing market cools down in the later months of the year as some sellers choose to delay their moves until January rolls around.
This is the first time since 2020 that we’ve seen an uptick in new listings this time of year. This could be a signal that the rate lock-in effect is easing a bit in response to lower rates.
What This Means for You
While there isn’t going to suddenly be an influx of options for your home search, it does mean more sellers may be deciding to list. According to a
Adrianna Derrick
Adrianna Derrick is a native of North Myrtle Beach, deeply immersed in the real estate world from an early age and inspired by the legacy of her father, Ernie Derrick, a revered figure in the local re....
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This data is updated on a daily basis. Some properties which appear for sale on this web site may subsequently have sold and may no longer be available. September 15, 2026 3:15 AM UTC
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