Why some homeowners are leaving their low mortgage rates behind
Add Axios as your preferred source to
see more of our stories on Google.
Illustration: Sarah Grillo/Axios
Ditching his first home in suburban Minneapolis for a bigger one nearby more than doubled Michael Vennerstrom's mortgage rate, but he's OK eating the cost.
Why it matters: Even this expensive housing market can't stop a young family running out of bedrooms or a Baby Boomer who's tired of cleaning an empty nest.
What they're saying: "If rates drop, we can [refinance], but if they don't, thankfully we upgraded our square footage when we could," says Vennerstrom, who has a toddler and a new baby with his partner.
First-time home buyers who can afford it are also taking the plunge.
- "When I saw that the current [mortgage] rates are about average, and in many cases, lower than other points in time, I realized it's not a terrible time to buy," Chicago condo shopper Sarah Martha says.
Reality check: Many U.S. homeowners feel locked into their current mortgage.
- Those with a mortgage rate below 3% say their likelihood of moving in the next three years would soar from about 17% to 28% if they could keep their current loan, per recent surveys from the New York Fed.
Chicago homeowner Colleen Day is ready to part ways with her low mortgage rate — and her three-level, four-bedroom house.
- The 61-year-old wants to "be free of a big home and all that comes with it."
- "We have had a beautiful life here, but it's time for a new family to love this historic home and attend these great schools," Day tells Axios.
What's next: More golden handcuffs could start to loosen. Optimism has grown that the Federal Reserve will start cutting interest rates in September, Axios' Felix Salmon reports.
