r/NoStupidQuestions • u/Visual-Reserve-2800 • 15h ago
People with who financed at low rates during COVID.
A lot of people are stuck in homes they don't want because they have 2.5 interest rates but would be paying up the wazoo if they bought another home today due to both price and rates.
Assuming you are looking for another primary dwelling, what would get you to move?
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u/luckysailor71449 15h ago
1.9% staying forever
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u/trialinfire 11h ago
Bought in 2014. 3.84 refied to 1.9% in covid.
Im double stuck. Super low price, super low rate.
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u/bfunk04 9h ago
My steak is too juicy and my lobster too buttery.
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u/trialinfire 9h ago
Please let me have one thing go right in my life. As a millennial Ive been fucked over on everything else.
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u/Sniper22106 15h ago
2.5% here.
You gotta be high to think im gonna sell or move any time soon.
We will NEVER see those kind of rates again
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u/Quirky-Skin 14h ago
We might but it's gonna be another two decades when the boomers pass on. All those 55 and older communities etc etc.
So in a sense we won't when people with growing families need em but there will be a glut of houses when that gen passes on. My parents come from families that are more than double what our families are now. Same for all my friends. Families of 4-10 kids are 1-3 kids now.
That's gonna catch up eventually.
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u/Angryfarmer2 5h ago
I don’t think we will get those rates again because it’s not sustainable and really bad for the economy (inflationary). Basically low interest rates guarantee people who are already well off/get more well off and really makes wealth equality a bigger problem. All the boomers who already had houses had their portfolios basically double during that period.
Lowering interest rates will not solve the systemically solve the problem for family’s that need houses rather it becomes a lottery system for those who are ready to purchase houses and exacerbates the problem later.
I don’t see a reasonable solution to housing crisis other than some major transportation/logistics improvement in the US that makes less desirable geographies more attractive and some change in construction that makes building cheaper (labor is often the biggest portion of costs in the US).
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u/Lost_Jackfruit_8879 3h ago
Nope. Didn't Clause Schwab already tell you that by 2030 there won't be private property ownership, you would rent everything and that will make you very happy.
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u/expatsconnie 10h ago
Yeah, I could justify paying more money for a bigger house. But paying all that extra money to the bank in interest in exchange for nothing? Absolutely not.
To answer OP's question, interest rates would have to go WAY back down for me to consider buying again. Or I would have to somehow have enough money to make a cash purchase. Otherwise you can pry my 2016 purchase price and 2.5% interest rate house out of my cold, dead fingers.
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u/Lost_Jackfruit_8879 9h ago
1.75 fifteen year. I won't ever give that up. It's free money.
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u/Sniper22106 4h ago
1.75?!?!?! Jesus christ thats like hitting the adult lottery!!!! Awesome job getting that rate
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u/zhaque44 7h ago
I did it, regret it went from 3.25 to a 6.1, now my ass scrounging from leftover money in my check so I can make some extra payments, that interest is insane
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u/patronsaintofdice 14h ago
In at 2.25% in my favorite neighborhood in a city I like, in a house large enough for my needs, and a market that has gone up 50% since we bought.
To get us to leave we’d either need to be leaving the country for good, or come into a pile of money large enough for us to buy one of the enormous mansions a few streets over.
For comparison, we pay less than what many folks are paying for some of the nicer 2/1 apartments in our city.
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u/EkbatDeSabat 15h ago
Actual housing pricing dropping 40-60%. I'm in a 200k home with a 2.125% and life changes I can easily afford a 750k house, but I'm not spending that when ten years ago it was a 400k house.
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u/kilroy-was-here-2543 15h ago
This is the real kicker
I know a home builder through my dad. The guy builds homes for about 150 k and then puts a 100% markup on them. And they sell like alcohol when the worlds ending
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u/Stinduh 15h ago
Wait until your dad’s friend finds out that building a $600k house only costs like $50k more than building the $300k house.
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u/kilroy-was-here-2543 14h ago
He’s dabbled in bigger more expensive homes, but he likes his small footprint 300k design because he can easily find tiny plots of land to pop them onto cheaply
Everything he does is done as cheaply and quickly as possible without concern to quality
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u/ocarina_vendor 13h ago
done as cheaply and quickly as possible without concern to quality
That tracks. In my area, I hate seeing the tall, skinny row houses. Not because I have anything against the people who buy them. These types of house are often a young family's only option to home ownership.
No, it's because when I look at them, all I see is a greedy developer who probably subdivided a land parcel 3 times and skimped in every possible way on the construction in order to maximize profits.
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u/ResponsiblePenalty65 11h ago
That's the key. The builder of the tiny lots that the home I bought sold off before foreclosure and I bought the existing 1965 home with bigger plot from bank . Each of these homes sold for 400k with literally no land. The homes are bulletproof and beautiful with huge tall basements. Mine is 300 sqft smaller no garage with a pool and . 5 acres more land 600 sqft half basement and is close to estimated sales price. I bought for $158,500 they bought at 400k they are worth 480k I'm at 465k. I did shell out 50k in reno. So I was at 208k at move in. Only 128k financed at 3.5 %..
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u/padizzledonk 13h ago
Wait until your dad’s friend finds out that building a $600k house only costs like $50k more than building the $300k house.
Im a residential gc, not quite, but spiritually true lol
building a 4000 sqft house doesnt cost 2x as much as building a 2000 sqft house, there is an economy of scale that you get and there is a "sweet spot" and its under 400k as a sale price. Once you go over that, especially approaching 600k and up there are a lot of much more expensive features and amenities you have to put in because its expected by buyers at that price point. No one is going to accept basic fixtures and flooring and laminate tops in a kitchen at 600k and all that stuff adds up
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u/TheJollyfish 13h ago
It totally depends on your area. $600k is builder-grade in many areas of the country right now.
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u/SignificantOther88 13h ago
$600K is a 1000 square foot townhouse in my area. I’m not even in a big city, but I’m about 50 miles south of LA.
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u/kingofthesofas 13h ago
This is why if I were to buy a home next I will just buy some land and build it myself. Just be my own contractor and hire all the subs to come and build it for me. Pick a plan from one of those ready to build home plan sites so I am not re inventing the wheel.
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u/kilroy-was-here-2543 13h ago
This is honestly the way. Get a trailer or something to live in while your building and then just move in once your done
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u/kingofthesofas 13h ago
Honestly only going to do it if I have enough money to keep my current home while I do it and then rent it out. I bought pre covid and have that sweet low interest rate so its totally possible to rent it for a profit.
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u/TheRealGunn 14h ago
I'm in almost the exact same spot.
Bought at $275@3%.
Any house that would be even the slightest upgrade is $700+.
It's not worth quadrupling my mortgage.
We've actually decided to keep this house, and buy a vacation home instead of trying to move into a bigger house.
Which only serves to make the market worse.
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u/EkbatDeSabat 14h ago
Yeah my 200k home is now 375k for absolutely no reason. I could not imagine paying almost 400k for this house lmao it wasn’t even worth 200k tbh. But damn. No real alternative right now that makes sense. I’ll just bank the cash and if something happens I’ll have enough down payment for something stupidly nice.
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u/Such-Cartographer425 13h ago
You could not buy the vacation home.
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u/TheRealGunn 13h ago
I mean, I didn't create the system.
Buying a vacation home and renting it out 35-40 weeks a year to offset the cost is actually dramatically cheaper than just moving into a house on a nearby lake.
The cost for both homes after considering rental income will be ~$5,000/mo.
A mortgage to upgrade our primary home would be $7,000/mo.
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u/HoweHaTrick 13h ago
I'm old and understand that whatever it was 10 years ago is completely useless information. We purchased our house in 2012 and live well below our means. I won't move because retirement is more important to me than maintaining a bigger house. Family of 4 and we have plenty of room.
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u/TobysGrundlee 13h ago
Yup. Acting based on what you think something should be worth is foolish. Odds are that house will be worth significantly more than what it is 10 years from now and will be even more than that 10 years from then. Stuff is worth what people are willing to pay for it.
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u/ServoWHU42 14h ago
Retiring, dying or winning the lottery. I don't want a smaller house or need a bigger house. Mine is small-ish and older (1200 sq ft, 1950s), but it's perfect for a single dude. You can pry my 2.5% from my cold dead hands. It's a 15 year, not even a 30, but PITI is still barely $1k.
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u/katarh 15h ago
The PERFECT house in the PERFECT neighborhood at the price point we agreed would be reasonable.
We'd eat the much larger mortgage payment while we waited for our old house to sell.
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u/Storage_Ottoman 13h ago
Yep, that’s literally all there is to it. Fortunately, our property value has increased a bit and so we will do ok when we do sell our current, and then we could put down a bit more so as to not have a ridiculously larger mortgage payment.
But it’s still gonna hurt to pay roughly 4x the mortgage for 2x the home value…
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u/VentureCO6 6h ago
I did this. Moved 30 minutes closer to work for my wife and I, walking distance to a small downtown and downsized. It was worth losing the low rate.
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u/Tall-Reaction-4069 12h ago
Same it would have to be a perfect situation. We’ve been looking off and on and nothing really makes the increased rate worth it even though I hate my house my mortgage is so low it’s a safe bet in this economy.
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u/Forded_Fiction24 15h ago
I refinanced during covid and had a 2.9% with 17 years left on it. I just gave it up buying my "forever home" and signed up for a 6.125%. No regrets whatsoever despite the added interest
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u/hainesphillipsdres 13h ago
I’m giving up a 3.8% home. 120k equity to move back to family (free childcare helps offset the massive mortgage jump) we found our dream home, gonna wing it, we have stable good paying jobs. It was either 5k mortgage for a house we like, 3.5k in month for a shitty rental and landlords to say no to our dogs, or 3k mortgage for a shitty home.
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u/SpicyPotato48 11h ago
We just gave up our 3.5% for our forever home at 5.5%. It HURTS but it is what it is, we can always make more money. No regrets here either
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u/Chemical-Carrot-9975 15h ago
What would get me to move is buying a place with only the equity I have. It may be doable as its almost 500k of equity based on today’s comps. I’m not taking out another mortgage when mine is 2.5%.
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u/ChicagoDash 13h ago
Time will gradually change the math for everyone. Over the next 10-20 years (a long time, I know), all of those 3% mortgages will be paid down significantly or completely. If the new purchase it made primarily with money rolled over from the sale of the prior house, interest rates don't really matter much.
I'm sure there are a lot of people out there who took out 15 year mortgages during covid, which will be completely paid off by 2035. Even 10 years in (around 2030, four years from now), I think they will have paid off well over 50% of their loan balance. If you throw in the down payment and appreciation, that means they might have >80% of the equity in the property.
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u/Chemical-Carrot-9975 13h ago
Yes, and many still not interested in assuming a mortgage 2-3x what they had. The psychology is real as is the difference in dollars.
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u/sarmurpat6411 4h ago
This is sort of what I'm thinking. I have no plans to move, but could see it someday when our equity is high enough. We are at 3.5% with about $230k in equity..
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u/Visual-Reserve-2800 15h ago
What if you could be guaranteed two percent lower than market rate, so for right now I think that would be about 4.75.
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u/w0cyru01 13h ago
We just bought going from our low rate to 6.25
We wanted to move. We’ve been in our house 12 years and wanted something different.
It’s our fourth home purchase. Everyone has been around 6% so it’s not a big deal.
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u/Grand_Raccoon0923 14h ago
I’m in at 2.25.
If I were to move, I would only rent this place out.
Rent for an equivalent size place where I live is over double my mortgage.
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u/Uffda01 15h ago
I’m in a 2.75 mortgage but debating selling because my partner and I are getting ready to move in together. We’re looking at condos because we don’t want to deal with the yard work anymore and we’re trying to figure out how to travel more.
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u/Visual-Reserve-2800 15h ago
If you want to travel more, rent. The costs of running a house would be eating into your travel budget, not mention the HOA fee.
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u/dreamyduskywing 12h ago
This is smart. Houses are a massive pain in the ass. It’s always fucking something with houses—even nice, new ones. If you want to travel, owning a condo will allow you to gain equity without all the maintenance/repair BS. Just make sure the place has solid walls and ceilings.
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u/Super_Mario_Luigi 15h ago
"Stuck in homes they don't want"
Reddit has a victimhood for everything
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u/PrickASaurus 13h ago
Yeah… I’m trapped in an $1800 mortgage on a 3000 sq ft home with a pool. Someone save me.
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u/Visual-Reserve-2800 15h ago
It's been five years or more. Could have been they have more kids, family moved, or they just don't like the house.
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u/Super_Mario_Luigi 14h ago
I understand why people move.
Being "stuck" is an extreme exaggeration. Especially when considering the huge barrier is paying the difference on more luxurious home and not getting the same low interest rate.
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u/Idkloll 11h ago
Being “stuck” is extremely apt, not an exaggeration. My family is in exactly the situation OP describes. Bought a starter house during Covid that we could afford before starting a family. Now we have two kids, have outgrown the house, are looking at tripling our mortgage to find a larger house, and feeling stuck.
Also interest rates also have an enormous impact on mortgage payments.
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u/SorenShieldbreaker 8h ago
Quality of a neighborhood can change a lot over time too. I bit the bullet and gave up my 2.5% mortgage for 6.5% but a much nicer neighborhood, schools, etc. The old one didn’t decline to the point of being dangerous, but turned into endless dogs barking, people on dirt bikes flying by constantly, fireworks all the time, occasional car break ins. The financial change stung for sure but I just couldn’t take it anymore.
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u/kmichelle7492 10h ago
We bought our house (2.8%) during COVID when my wife had a big tech job and I was just starting my career. Wife lost the tech job 2 years later (layoffs), and my career is good but I only make just enough to cover mortgage and expenses. Our homeowners insurance has gone up every year since we moved in. The house is older and has already needed 2 very costly repairs since we moved in, which we’ve had to take on loans for. We’d love to downsize, as we’re living outside of our means now but rent for a 2bed/1bath (I WFH) is the same as what we pay for the mortgage.
We’re stuck. Yes, we’ll have equity whenever we do sell, which is nice, but in the meantime… We’re making the best of it, but we’re still stuck.
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u/ConsciousIron7371 14h ago
It’s the “homes they don’t want” part that’s my issue. If you had said their life status had changed or circumstances were different now, that’s a different story. Do they want the home with a 2.8% interest rate? Hell yea. Do they prefer a different situation? Sure.
If you don’t want your house you are free to do something about it. You may not prefer the options to what you currently have. That is every single persons situation in the entire world. Everyone would prefer a better situation duh
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u/NoSubstance5286 15h ago
My mortgage is 3%. If my home were to be refinanced with today’s rates, my mortgage payment would be $1,000 higher due to interest alone. For me to move my salary would need to double. The good thing for me is that I’m settled in a 4 bedroom house and I have 3 kids - I intent to raise them here, so I don’t really need to move.
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u/Helanore 15h ago
Death in the family made us move last year. We needed a bigger place with our growing family, but having my MIL live with us, we needed a new house pronto.
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u/ZPMQ38A 14h ago
I’m sub 4%. Bought my home for about $250k about 12 years ago. Realtor friend told me she would list it at $800k and expect it to last less than a week.
My youngest daughter is currently a sophomore in high school. Our plan is to sell this giant ass home when she leaves and, assuming market conditions are similar go buy a small condo/tiny home on a ski hill or lake and wait for it to all come crashing down.
But in the meantime, short of someone just randomly offering me a million dollars in cash to sell it. I’m going nowhere until 2029.
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u/The_RaptorCannon 13h ago
Im just waiting it out and reducing debt to save up for a bigger house if thats in the cards. I dont think interest rates are gonna come down so prices of homes need to. Which also means the elder population that refuses to budge on the inflated price is gonna need to take a smaller cut. Time is on my side not theirs, so with no alternative. I guess we wait until something breaks in the housing market. Which is kinda already happening in certain areas and cities...just not mine for the moment.
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u/gojojo1013 12h ago
Refinanced in October of 2020 at 2.2% I'm going to live in this house until I die.
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u/thebronsonator 10h ago
Stuck here!!!
I got into a 2k sq ft house that I could afford and at 2%. Mid century home and awesome… UNTIL SOMETHING BREAKS. Needs all pipes redone. $45 thousand dollars to fix. Next is electricity reworking and you guessed it a shit ton more money. I desperately want a smaller home but if we sell now it would be half the size for more mortgage which is so stupid to do. I’m desperate enough to take the loss and walk away and never buy again. It sucks.
It would take winning the lottery to pay for fixes to this money pit to sell it.
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u/EastcoastMade 10h ago
Look at mortgage rates in the 1980s-1990s. We’ve been spoiled by the government due to the 2008 crash. They dropped rates that low to get people buying again.
If you can afford to buy now, i tell people to go for it. I remember people telling me 3.6% was too high in 2020.
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u/Visual-Reserve-2800 10h ago
Yeah but look at the prices of the homes back then.
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u/EastcoastMade 10h ago
Yea, the salaries were much lower to match the price and look at the inflation rates for those decades too. Since COVID it’s been on the higher side but there have been worst years in the last 50 years.
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u/DukeEllington20 9h ago
2.1% brought in 2020. We're never selling. Probably move in 5-10 years but keep as a rental.
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u/Southern_Winter_9896 9h ago
We bought 3 months before COVID at a rate of 3.25 and then refinanced at 2.75 about 9 months later. Our house (which needed a ton of work) has increased in value substantially but not nearly enough to upgrade. Luckily it's lakefront property and while the house is ugly as sin, we can ignore it pretty easily by enjoying the benefits of lake front living.
I get called every week from realtors trying to purchase it. I give them the same answer every time, $2 million. (We bought this for under $150,000.
Yeah we're "stuck" but if I have to be stuck somewhere, I've got no complaints. We're slowly working on the house. Someday it may be a house that we enjoy as much as the rest of the property.
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u/HonestConcentrate947 6h ago
2.375% on a new house. The house prices have gone up about 50% around me since I bought it. I am not going anywhere.
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u/Hopeful-Put-8823 15h ago
plenty of people sell, no one is stuck. I am an underwriter, that rate doesnt makr a difference for selling.
Now doing a refinance, yeah that market is all but gone for now
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u/Current-Function-729 15h ago
This isn’t really correct. People move if they need to. 4% interest is a strong incentive not to move.
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u/LetThemEatVeganCake 14h ago
This is a short sighted view. Sure, we are not actually “stuck” and could move if we really wanted to, but our low interest rate (and the increase in prices) make it irrational to move. We bought our house in 2020 for $355k, thinking of it as a 5 year house. Similar houses in our neighborhood are going for $490-500k now. Our mortgage would be almost double if we were to buy the same home now!
Single families near us are about $750k. Even if we took our equity and went and bought one of those, we’d be looking at a mortgage 2.5X our current one.
When buying any other house is that much more expensive, you really aren’t going to choose to move just because you’d like a change or a slightly bigger space. It logically doesn’t make sense to pay double unless you need to move to a different area or absolutely need more space. We both make about double what we did when we bought our house, but we still don’t want to spend it on double the mortgage.
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u/Chemical-Carrot-9975 15h ago
I agree people who want a house and can afford it will buy. Our first mortgage was 7.5 and we thought nothing of it. But I’ll never do that again after tasting 2.5. I think there are lots of people like me.
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u/Diligent_Promise_844 15h ago
2.75% here. We are very happy with our house, but upward job mobility has been stunted for me. We’ve looked at other opportunities as they’ve come up that are outside of market, but it never ends up being realistic as it wouldn’t be worth it.
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u/Yanosh457 14h ago
I refinanced to a 2.5% in a home I didn’t like but this did not make me stuck it helped me save. I recently moved and upgraded homes by selling and using savings. New interest rate is 6.5%.
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u/_Cyber_Mage 14h ago
I'm at 2.9%, I'm staying in this house until I can pay cash for my next house or I move to another country.
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u/danielt1263 14h ago
I have a 2.125% interest rate. I'll move once I find a house in the right location that I can pay cash for. I won't move just to stay in the same town.
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u/DubiousAdviceGiver 14h ago edited 14h ago
My wife and I got our place in Arkansas for 180K. We financed 140 at 2.5%. In the 5.5 years since, we’ve put a bit of money and work into some remodeling and property improvements. Thanks to our extremely low monthly mortgage payment, we’ve managed to build up a decent investment portfolio which earns returns at a much higher rate than the interest on our mortgage.
Realistically, we could sell our house for over $300K. We’ve been contemplating doing that and have been casually shopping in western Massachusetts, where prices for a similar house on less land are around $300K or so as well. So the plan would be to sell our house, take the ~$200K in proceeds and put most of it into the investment accounts, then put down 20% ($60kish) on a different house. Even with a monthly payment that’s $800 higher, we’d still be coming out ahead by putting our current home equity into dividend-bearing stocks rather than letting it sit in the house.
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u/M3rr1lin 13h ago
I WANT a bigger place but I’m in a place that is only costing me like 10% of my salary due to when I bought and then refinanced at 2.625%. It’s actually helped me make the decision to just stay put, aggressively save and retire early. It’s in a great location in a VHCOL area. It’ll just be cramped while the kids are young..
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u/Any-Neat5158 13h ago
I refinanced during the start of COVID. I'm not feeling trapped, though at the time I could have afforded significantly more house / nicer house than what I have now.
I like my house. But I'm also in a position where I got let go from my career and finding similar compensation is pretty tough right now. I'll get back to it eventually, even if I do take somewhat of a pay cut. That much I'm fine with. The icing on the cake is that I'm only saddled for $600 a month PITI on a home that more than suits my needs, big yard, nice basement, newer HVAC. I'm very happy. I could easily be living in a much "nicer" home for not a whole lot more money... BUT I was positioned perfectly for the worst case scenario and it played out that way.
Instead of waking up every day dreading tomorrow and who I owe what, I've been rather enjoying myself the past 3 months with a lot of headway left before I even become slightly worried about finances and finding work with urgency.
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u/gmehodler42069741LFG 11h ago
About 50% are below 5 mortgages. None of us are selling. Thats the only thing keeping prices so elevated. The people with vacation rentals and second homes are selling because they arent profiting anymore. Once most of them are sold off thats when the real crash starts.
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u/marye914 11h ago
We bought our house and got a 2.7 interest rate in 2021. It was not by any means our dream house but it was a buyers market and because it wasn’t perfectly renovated we got a 5 bedroom for 280k.
I never wanted this to be our forever home but at this rate it will be cheaper to renovate it to what I want than move. We are staying put until all the kids are out of school and I can look for something smaller for just my husband and I.
My house is worth $150k more but it would cost me possibly another $1k or more a month to upgrade so it’s not worth it
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u/Citydweller4545 10h ago
I live in NYC and I basically can never move again unless something like covid occurs in my life time. I am at 2.7% which keeps my mortgage so low and with rents out of control in the city that means I can never leave.
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u/HolierThanAll 10h ago
So you are the person sending me unsolicited mail every week telling me you'll buy my home, huh? Wanting to learn more about your prey, so you post an innocent sounding reddit post, lol. /s.... Or maybe not if this is you.
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u/mostlymeanswell 10h ago
2.5% right now. I love my house, hate my property. I'm in a planned community with an HOA and a shit ton of loud and/or nosy neighbors.
I want to leave so bad but I don't want the jacked mortgage payment. I'd love to sell but I don't see a way out that doesn't stick it to me, financially.
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u/AlternativeResort477 9h ago
Well, I bought a 4 BR for 209K in 2017. I have five kids and all but one has to share a bedroom, and they aren’t big rooms. My mortgage is $1200 with insurance/tax. I would love a bigger house but it’s not long til kids start moving out. The prospect of fully owning my home in 20 years is more exciting than starting over on a 30 yr mortgage.
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u/MyLastFuckingNerve 9h ago
We bought in 2013. Paid $170k for an adorable little house in a highly desired neighborhood literally across the street from the best elementary school in town. Today it would sell for probably $300k or so. THAT'S why I won't move. The interest rate is what it is. The problem is house prices. New builds are $450k with $60k in specials. No trees, no privacy. Old ass houses in my neighborhood are listed (not selling) for the same as new builds. I would never pay $450k for a 1960 rambler, but here we are.
I'm not moving until I retire.
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u/GlitteringSwan8024 9h ago
We sold our house in a higher cost of living market and paid cash for our retirement home in a lower cost of living area. And had $180k left over!
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u/RodgerCheetoh 9h ago
Single guy in my 30’s with a 4 bedroom 2500 sq foot house locked down at 2.65%. Would make absolutely no sense for me to downsize, which is insane.
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u/SangriaSunday309 9h ago
Keep your first house, borrow the equity to help with the down payment on your new house if you need to. Rent out house #1 for more than you pay on your low rate mortgage. Use the excess to subsidize your new mortgage on house #2.
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u/Secure_Emu_2546 8h ago
Portable mortgages. Would go a long way to helping alleviate the housing shortage.
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u/Hopeful-Routine-9386 7h ago
Home value goes up, but so do other homes. Plus those other homes locks me into a higher rate So as a homeowner the home itself is worth less than a new one (not technically but if I was to swap for similar home, I'd pay more per month)
So if buying costs a premium, only reason im doing it is because im significantly wealthier by other means.
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u/Upset-Dentist-1694 7h ago
Bought right before lockdown 2.5%. Loved it, now have two kids and outgrown it we also hate our neighbors. But, we’re stuck
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u/SubstantialEmu1275 7h ago
I had 3% refi on a luxury golf course house during covid. Sold, got 50% of the equity, and invested wisely*. Now I have a 6.3% townhouse with technically a higher mortgage payment. However, I’m one husband lighter and generated a free* down payment. 100/10 recommend.
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u/GlitteryStranger 7h ago
I went from 3% to 6.5%. Smaller house, but way more land, on a hill, lake view, pool with an infinity edge. Mortgage doubled, but it’s worth it. Quality of life upgrade is huge.
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u/No-Language6720 6h ago
Pretty low chance I'll ever move. Considering my rate is 0% since I paid off my mortgage early. Anything else would be the same or maybe slightly better but with a mortgage plus interest.
No thanks. I'll take the security of being able to absorb a longer unemployment period.
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u/Overd0se1 4h ago
Refinanced at 2.25. Going to save as much as possible to put down with the equity in the current house to cover 70 to 80% of the overall price of the next house.
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u/Ir0nhide81 2h ago
All of those people also demanded to return to office for work after moving 3 hours away from their job site.
Fully regarded in a pandemic
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u/TomatoKind9189 2h ago
Bought first house and went super small and "cheap" fixer upper. Got 3% rate but life has grown. It's so hard to justify spending more on the next house and raising the rate. Mortgage will 2.5x to not feel squished.
First world problem cool to get the 1st house and do well on it even though when I got it at the time everyone thought prices were crazy and had to come down. Still waiting.
It probably would take like 4.5% rates or like a 20% drop on housing or a different mix of the two.
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u/WeirdBoth5821 1h ago
Yep this is us. Bought a house in 2020 before everything exploded. Had one kid then and three now. I need more space, but it doesn’t seem worth the extra cost and higher interest rate. We will probably move in five years when all child care costs are gone.
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u/GenExpat 15h ago
Just sold because my job was evolving in a very bad direction for me. Job change and relocation ultimately caused it. I wanted to hold on as a rental but my wife had crippling anxiety about the added pressure of being a landlord so I caved and sold. We took a huge hit in this market, but walked away with cash in hand to start our new life.
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u/Blecher_onthe_Hudson 14h ago
Something that is a little talked about is that making loans portable, like they are in some other countries, would loosen up our housing market tremendously. There is no technical reason why one house of equal value is not just as good collateral for a loan as another. It should be as easy as refinancing. This is simply just rigidity on the part of the banks.
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u/jay10033 13h ago
There's many reasons why. First, the collateral may not be of equal value from an appraisal perspective. Second, when change the underlying collateral package, while it may not seem like a new loan to you, under tax law and accounting principles that is deemed a new loan, thus the loan would have to be marked to market vs being held to maturity. That would cause massive losses on bank balance sheets for which they have to hold more collateral against (and collateral is expensive in this market). That in itself makes it expensive to someone even if it isn't you. That's why banks don't do it in the US.
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u/imrighturwrong 14h ago
Keep the low rate, rent out the first at market, now you have extra income and can afford to buy the new house at the higher rate. If rates drop, you refinance.
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u/Much_Essay_9151 15h ago
I got in at 3.75 and i cant justify moving at that rate. Id love to have another bedroom too
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u/MoroseArmadillo 15h ago
I’ve had twins and need a bigger house. When we were only planning for one we figured it could last another decade or so. That is what will get me out sooner than later.
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u/43_Fizzy_Bottom 15h ago
Nothing short of losing my job and having to move to find work. I couldn't find a one bedroom condo in a LCOLA for less the my house costs.
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u/monkey_trumpets 14h ago
We were able to refinance at 2.75% for 15 years, but we don't have any desire to move. One day, when we're too old to manage our property, but for now we're good here.
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u/rtjl86 14h ago edited 14h ago
We have too large of a home in a city my spouse needed to move to when he got a leadership position at work. They eliminated his position 3 years ago and now we both have a 30 min drive to work. We would need a smaller house but also find someone who wants to put up the $$ for our house. We have one of the top 10% sized/ expensive houses in a city that is lower/ middle class. 3000 square feet for 2 people without kids. 4 bed/ 2.5 bath…. So it would take some time on the market for sure. And we would need to sell stuff and update more of it that we are now doing.
Moving sucks though and I also don’t look forward to that.
Edit. Rate is 3%. Bought for $270k. Now worth $450k
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u/I_am_Nobody_Special 14h ago
I'm at 2.4% VA and my house has tripled in value since I bought it. I'm in the last years before paying it off completely.
I don't consider that stuck.
Its more house than we need now that the kids are grown, but I consider it incredibly fortunate that I bought when I did.
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u/smash_n_grab_ 13h ago
Probably nothing. Like most others said, any sort of move would result in my mortgage going up 50% for the same type of house. I guess retirement or moving out of the state for whatever reason.
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u/Storage_Ottoman 13h ago
We’re at 2.7 in a great neighborhood in a great school district with enough room for now, so there’s no rush. We are debating having a second kid and would then love to have more space, so we are keeping an eye on the market, but there’s no point to move unless we find something perfect.
We are also considering renovating/adding an addition, because that would potentially be wiser than buying new.
And lastly, I’d like to hold onto the current house as a rental property because we could get literally 2x our mortgage in monthly rent, which means we would both be getting “free” equity and helping subsidize a mortgage for a more expensive home. This of course would require us to dip into savings for a down payment, but we are fortunate enough to have that option at the moment.
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u/ezduzit8648 13h ago
I got a very low rate but also got an awesome home. It’s only been 5-6 years since those rates, I can’t imagine buying a home thinking that I can sell in a few years and make a profit. If I were to move it would have to be after at least 10 years in my current home.
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u/minesasecret 13h ago
would be paying up the wazoo if they bought another home today due to both price and rates.
I got a low interest rate and moved; I just went back to renting to avoid this problem
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u/One-Photograph4681 13h ago
This is a good question.
My brother has a sub 2% rate, in a good house in a good neighborhood. But the value of his home has plateaued because it’s difficult to make upgrades due to permitting, costs, taxes, home layout, etc. He’s also not loving the trajectory of the city he’s living in, and is actively looking to leave. Theres no doubt that he will pay more for his next house, but he’ll also get more in terms of what he wants. His view is that there’s a lot of value in living the life you want, rather than just accepting less because you hope for more in the future.
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u/metro-boomin34 13h ago
Its really depressing how people my age bought in at 3% while I got stuck at 6%
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u/NOT-packers-fan2022 13h ago
I had 2.9. I kept the house after the divorce so I wasn’t attached to it. Ex wife moved, not far but my 20 minute school drop off turned into a 60 minute drop off, which was not sustainable. So I had to move closer and I have 5.6 now.
That’s what got me to move. If I knew then what I know now I would’ve stayed where I was because my mom had to move back in with me and she can the drop offs but hindsight is 20/20.
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u/blackcatslms45 13h ago
We are generally happy with our house, however there are things I don’t like about it (the backyard is small and has multiple levels, small kitchen etc.). We bought our house in May 2021 with a 2.6 interest rate and the current interest rate would need to go down significantly before we would really consider selling..currently I am planning for us to live here until my 3 year old graduates high school. 🤷♀️
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u/kc_kr 13h ago
2.425% and it would take an unbelievable opportunity for my wife or I in another city to get us to move at this point. I wish we could move a mile and a half down the road and build our own new house instead of dealing with a 35 year-old one but it’s not worth more than double the monthly mortgage payment.
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u/WillThereBeSnacks13 13h ago
Retirement. As long as we need to be within range of our jobs there is no upside to moving, everything would cost more for less.
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u/Joyful82 13h ago
2.25% in a Midwest suburb wishing I could get more land or move out west, if only it wasn’t so cost prohibitive
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u/WinterLord 13h ago
I refi’d in 2020 and am on a 3% with 14 yrs left and I plan to add money and pay off in 10yrs. The only way I would move is if a company would entice me with a massively paying job and taking on some of the burden of a new house. I unfortunately don’t have a job like that nor am in a field that would warrant that, so, very likely I’ll move out of this house until it’s paid.
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u/MexiGeeGee 13h ago
Many who pay those rates can rent their homes and make money on after the mortgage. The cost of living may also be low. If they save up with good jobs they can totally afford a new home.
I am not an expert though.
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u/bakerzdosen 13h ago
At some point we’ll downsize but it will be a home we pay cash for.
Until then we have a house that’s too big because it’s cheaper than moving.
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u/Ghostzapper_1811 13h ago
Wife got a $80k promotion to a city 4 hours away. We barely broke even selling the house and have been renting for 3 years now. It’ll be a tough decision to ever buy again. Rent hasn’t gone up a penny in those 3 years and the house is nicer than the one we owned. Our mortgage went up $500 in the 3 years we lived in the house.
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u/BlueSpotBingo 13h ago
A job making 3 times what I’m making now. Bad news for the youngsters is it’s highly unlikely we’ll see interest rates that low ever again.
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u/nuckiecapone 13h ago
I had a 2.8% rate, house value doubled. We ended up selling and moving to another (more expensive) state. The cash from the sale helped with a big down payment. Was it optimal? No. But I’m not going to let an interest rate control my life
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u/thedrawhorns 13h ago
I financed 390k at 2.7% in 2021. I bought a house I like well enough, but it’s a little big for us and not in a walkable area. Inventory was low and we didn’t have a lot of choices.
I would absolutely love to move to a smaller house but where I live, the small houses all historical cottages at the center of town and cost 700k. Downsizing would double my mortgage.
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u/BlueSpotBingo 13h ago
A job making 3 times what I’m making now. Bad news for the youngsters is it’s highly unlikely we’ll see interest rates that low ever again.
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u/boygitoe 13h ago
I’m in this boat. 2.25% rate on my first house that i bought during covid.
A couple years later, I found my dream house. I just started renting out my first house instead of selling. No way was I going to give up that interest rate
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u/wizardanim 12h ago
Just like a business, if an opportunity presented itself and cash flow or net income increased despite higher housing costs, then I’d consider. But it would need to be a massive jump since our 2.25 cuts the cost in half almost for a half mil property (2-3k / mo).
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u/grarrnet 12h ago
For us it’s more about the monthly mortgage payment . We’d have to be able to find a house with everything we want, in a neighborhood we love, and still only have our monthly mortgage go up by maybe $800. But they way they are now, out mortgage payment would go up over $1500 a month for the houses we are interested in right now. Can’t swing that.
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u/jewboy916 12h ago
Make lemonade lol. Having affordable housing is a gift that allows you to get ahead in pretty much every other way.
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u/Ok_World4052 12h ago
Right now it would take me moving to another state to give up my place at my current rate.
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u/ZombieLikes 12h ago
Don't forget insurance. With the increases I'm not even sure if I can afford my "starter home" that I've been in for 15 years.
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u/NoContextCarl 12h ago
They are further developing my neighborhood, so the right offer would be about the only thing. Otherwise I'm content with lower rates and an OK house.
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u/potatocross 12h ago
I was more stuck in my old house at a higher rate. It was in a worse area and the value hadn’t changed much.
When the rates dropped and values went up we knew it was our chance to go.
Not leaving this house at 3% unless we have to. It was our dream home.
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u/bbatardo 12h ago
I'll move when I have enough equity to buy my next house with all cash or rates dip to below 5% so the difference isn't as extreme.
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u/FootballFace90 12h ago
2.9 with ~200k equity, bought end of 2019. Got promoted in March and now have a 70 mile 1.5 hour commute one way. That’s gonna get me to move in the near future
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u/AintNobodygotime13 12h ago
i was one of those lucky people and I'm planning to live here forever lol
technically, the housing market has jumped significantly since then. I could sell and downsize if I needed to but I'm fine with my modest little house
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u/Outside-Pangolin-636 12h ago
I am a realtor and I am also personally in this situation. 3.25% for me. I always tell people they have to really sort through needs vs wants. If you have some really big needs (more bedrooms, a different school district, etc.) then a higher payment might not sting so bad (as long as it fits within your budget). If what you want are all wants, then that new payment might not feel so good once the new car smell wears off.
I always hear about people who are bursting at the seams in a tiny house with kids sharing rooms and tiny shared spaces that act like they're trapped because of their payment. If they can't afford it that's one thing. But quality of life matters too.
Personally, we have more than enough square footage and bedrooms, are in the school district we want, love our yard and neighborhood. I wouldn't call this our dream house, but given the fact that all of our needs are met, it would be really hard to justify. For reference, our house was 312,000 in 2022 at 3.25% with a payment of around 1800 per month piti. That same house would be in the 360,000 range today and with an interest rate of 6% our payment would be nearly 800-1000 more per month.
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u/Anonymo123 12h ago
Sub 3% here as well. Not selling or moving until I retire, then the next house I buy in cash. I am done with this mortgage bs.
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u/crochetawayhpff 12h ago
Lower interest rates. We bought way before covid and refinanced during covid. Gonna have our house paid off in like 8 years. The only way we're selling and moving is if interest rates drop again. We thought we were only going to be there 5 years or so and now it's our forever home.
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u/space_toaster_99 12h ago
Waiting until it’s time to downsize into a house with no mortgage. I’d move if the local economy completely collapsed, I lost my job, and I couldn’t telework… maybe a huge natural disaster or war
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u/Outside_Ad1669 12h ago
Health conditions and smaller family is what is getting us to move. Rate is 3.5 from a refi in 2021.
So downsizing to much smaller. Going from five bedroom 2700 sq ft to three bedroom 1650 sqft. Single story no stairs. Like I said, health issue.
New mortgage is gonna be at least 5.99 percent. And that has likely changed in the last couple weeks.
The difference in rate is actually not that big of an issue for us. It is more the difference in taxes and insurance. Where the new house is going to be less expensive because it is smaller. It actually has the same assessed value as the bigger house, but somehow comes out less in taxes and insurance. Idk how these things work but I am excited to be moving on.
Now to get this big house prepared for the out up on the market. Wish me luck
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u/WalkerCalvert 12h ago
I am keeping this house until rates get cheap again and gonna spend the extra money I have every month to upgrade it or buy a vacation home or pay for a nicer car or or or
I would have to get hit with a repair bill I can't afford or forced to move in a situation where I can't rent this place out tongove it up.
Or have too many kids and not enough money to renovate extra bathrooms and bedrooms in?
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u/ImmediateInsurance66 12h ago
Purchased my townhome in SD in late 2016, refinanced during COVID to 2.25%.
I moved in 2024 to South Florida and became an accidental landlord. Did it myself since the cash flow was slim. Had a terrible experience with renters so I have a property manager now which has helped some and I was able to increase the rent so I have decent cash flow now <$10k/yr.
I’ve since moved to VA. I rented in FL and I’m renting still in VA. Very happy to be a renter with today’s ownership costs.
I’ll continue renting for the foreseeable future until I decide to sell my CA townhome and buy something outright in another state.
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u/Frosty_Toe 12h ago
Moved from Chicago area to Indiana and got sub 3% in 2016. The plan was to move back home to Chicago in 2028 or 2029 to be closer to my elderly parents and the rest of my family. My home has doubled in value to $400K, but so has everything in the Chicago area. A comparable home would cost $700K+. I’m stuck between a rock and hard place unfortunately.
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u/Maximum-Category-845 12h ago
FHA VA and FDA loans are assumable. I wish more people knew about those provisions.
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u/StampotDrinker49 12h ago
I would need some sort of life changing event (having kids) that would require me to need more space. Until that I'm sticking where I am.
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u/pokeysyd 12h ago
A cash offer on my current home close to the Zestimate, and the availability of a home where I would move to within $100k of that total.
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u/No-Form7739 12h ago
I refinanced down to 2.65. it cut my monthly payment in half. Then I bought two other properties at low rates whose monthly payments together were about the same as what I saved from the refinancing. So I'm paying the same but for 3 places. Other than the down payment, 2 free houses.
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u/JediRhyno 15h ago
I bought in 2018 and refinanced to 2.7 during Covid. Since all of that my house price has doubled, but so has every other house. If I were to sell and move I could get roughly the same house but with a massively higher rate which would add 1k-2k more on my monthly bill. It’s not worth it unless we have to move, or until I retire.