US Housing Remains Frozen Amid Persistent Mortgage Lock-in and Slight Rate Relief cover art

US Housing Remains Frozen Amid Persistent Mortgage Lock-in and Slight Rate Relief

US Housing Remains Frozen Amid Persistent Mortgage Lock-in and Slight Rate Relief

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 The US housing market remains frozen in the past 48 hours, gripped by a persistent mortgage lock-in effect from sub-4% pre-Biden era loans, stifling supply and sales despite slight rate relief. Freddie Mac reported the 30-year fixed mortgage rate dipping to 6.18% as of December 24, down 0.03% from the prior week, with 15-year rates edging up to 5.5%.[3][4] This modest decline, tracking a stable 10-year Treasury yield around 4.14%, has sparked cautious optimism, boosting purchase applications 19% year-over-year per the Mortgage Bankers Association, though overall applications fell 5% last week amid softening jobs data.[2][7]

Inventory stands tight at 1.43 million units nationwide, up 7.5% from 2024 but well below norms, fueling a seller surplus where listings outpaced buyers by 37.2% in November—the widest gap since 2013.[2][6] Home prices hover near $400,000 median, with affordability crushed as incomes rose 25% over five years while prices jumped 55%, compounded by surging taxes and insurance.[1] Sales volumes linger at 75% of 2020 levels, resistant to correction due to $17 trillion in homeowner equity buffering moves.[1]

Major builders like D.R. Horton are countering with rate buy-downs to 4.99%-5.5%, spurring new home sales amid low supply.[2] The NAHB Housing Market Index hit 39 in Q4, its eight-month high, signaling future sales hope at 52.[2] No major deals, partnerships, or regulatory shifts emerged in the last 48 hours; focus stays on life-driven listings gradually thawing the freeze.

Compared to early 2025 peaks near 7.5%, today's 6% stability feels like progress, yet the lock-in persists through 2027 per Cotality, unlike normalizing peers like Australia or Canada.[1][2] Buyers gain leverage with rising delistings and price tweaks, but consumer caution rules amid 4.6% unemployment and 2.7% inflation.[3][5] Leaders bet on holding steady for a 2026 rebound if rates ease further.[2] (298 words)

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