Mortgage Lock-In Is Wearing Off at 5.8% a Year. What a Slow Unlock Means for Buyers and Sellers in San Diego and Chicago

Lock-in is real, but it is not permanent. Research cited by HousingWire puts the annual "unlock rate" at 5.8%. Each year, that share of homeowners holding low-rate mortgages moves anyway, even with the 30-year fixed at 7.57% in early October, as the piece notes.

The number matters because lock-in has usually been described as a wall. The common view has been that owners holding pandemic-era rates simply will not sell until rates fall. This research points to a slow leak instead. Families grow, jobs relocate, couples separate, parents downsize, estates settle. None of those moves waits for the Fed.

What it means for sellers. If you are a low-rate owner thinking about a move, plenty of others are making the same call. A 5.8% annual pace adds up. Every year, more of the low-rate group reaches the point where the house no longer fits their life, and the rate becomes one factor among several instead of the deciding one. In San Diego, many longtime owners hold substantial equity, so the math often works better than the headline rate suggests, especially for sellers who are buying down or putting a large share in cash. In Chicago, property taxes make up a large part of the monthly payment, so comparing the full monthly cost of the current home and the next one, not the rate alone, gives a truer picture.

What it means for buyers. Inventory is likely to recover gradually, not all at once. Buyers waiting for a flood of listings when rates drop may find that supply arrives in pieces. The steadier approach is to watch the homes coming to market now, from owners whose reasons for moving have nothing to do with rates, and to be ready to act when the right one appears. Those sellers are often motivated by a timeline, which can open room to negotiate.

How our team reads it. The unlock rate is a reminder that housing markets run on life events as much as on financing. Across San Diego and Chicagoland, the decision to sell usually starts with a change at home, not a change in the bond market. Rates shape what a move costs. They rarely decide whether it happens.

If you hold a low-rate mortgage and are wondering whether a move still makes sense, the answer depends on your equity, your next home, and your timeline, not the rate alone. Our team is glad to run those numbers with you, whether you are buying, selling, or doing both.