"Golden handcuffs" lock up Michigan's housing supply
Add Axios as your preferred source to
see more of our stories on Google.

Roughly a quarter of Michigan homeowners with mortgages have a rate below 3%, per Redfin data shared with Axios.
- Those low rates are locking homeowners in place, which then leaves potential buyers with fewer homes to choose from.
Why it matters: Mortgage holders are experiencing the "golden handcuffs" phenomenon: They might have a great rate, but if they want to relocate or find another home, they likely can't do so without spending a lot more cash, explains Redfin chief economist Daryl Fairweather.
By the numbers: Just 8.7% of Michigan homeowners had a mortgage rate above 6% as of October 2022, per Redfin.
- Almost 10% of them had a rate of 5%-6%, while 21.1% were at 4%-5% and the largest percentage, 39.2%, were at 3%-4%.
What they're saying: "Many people have decided to sit on the sidelines — 'Let's stay in our home for now; we can save up our money for a higher down payment down the road,'" Gino Tozzi, a member of local real estate data company Realcomp's board of governors, tells Axios.
- Tozzi, also a broker with Real Estate One, points to historically low inventory as a long-term problem in Metro Detroit — not just because of people opting to stay in their current homes, but also builders bringing little new inventory to market.
Zoom out: Nine in 10 U.S. homeowners secured mortgage rates below 6% as of late 2022, per Redfin. Meanwhile, mortgage rates have swung between 6% and 7% nationally in recent months.
Meanwhile, buyers are also exploring adjustable-rate mortgages or buydowns in hopes of a lower monthly payment, Fairweather says.
Reality check: Lower rates could loosen up some supply, but not enough to meet demand.
- New construction isn't keeping up, either. Fairweather predicts it'll take the U.S. a decade to repair its housing shortage.

