Many Americans claiming "I can't sell my house" are not exaggerating. The U.S. real estate market is in a strange and unsettling middle ground: caught between stubbornly high home prices, a plethora of ultra-low mortgages obtained during the pandemic, and today's more expensive loans. Despite weakened demand, many homeowners feel financially and emotionally trapped. While selling a home may theoretically make sense, in practice it often means giving up historically low mortgage rates in favor of higher ones. For many families, this trade-off is simply too risky.
The Mortgage Lock-In Trap
During the pandemic housing boom, millions of buyers locked in fixed mortgage rates below 3-4%. Today, new loan rates are typically close to 6-7%, significantly increasing the cost of moving. According to research from the Federal Housing Finance Agency, every time there is a 1 percentage point gap between a homeowner's current mortgage rate and the market rate, the likelihood of selling decreases by about 18%. This so-called "lock-in effect" may have resulted in approximately 1.7 million home sales not occurring, keeping home prices about 7% higher than they might otherwise be.
I Can't Afford to Sell
For many homeowners, the math is an interesting topic. A family with a $400,000 mortgage at a 3% rate would face significantly higher monthly payments if they were to buy a new home at today's 6-7% rates, even if the new home's price is similar. A 2025 survey showed that about 63% of homeowners are reluctant to sell due to borrowing costs, and nearly 90% feel at least some anxiety about selling their homes.
In addition to mortgage rates, sellers are also concerned about multiple risks:
The result is a strange paradox. Many Americans want to move—due to work, family, or lifestyle reasons—but feel that doing so would harm their finances.
The Market is Frozen, Sellers are Frustrated
This has led to a real estate market that appears strong on the surface but is actually frozen. In 2025, total sales of existing homes fell to just over 4 million, the lowest level in decades, slightly below the already weak levels of 2024. Inventory remains tight as many homeowners refuse to list their homes for sale, while others list at inflated prices and withdraw their homes from the market when offers do not meet expectations.
A notable trend is the increase in "withdrawals." Rather than lowering their asking prices, more sellers are choosing to completely take their homes off the market. By the end of 2025, the number of withdrawals had increased by over 50% year-on-year, and even as buyers became more cautious, this helped maintain high prices. This helps explain why some homeowners complain that their homes are "unsellable." In reality, buyers may still be present, but the gap between the prices sellers hope for and what buyers can afford has significantly widened.
As inequality deepens, buyers are under pressure.
For first-time homebuyers, the situation is even more challenging. They face a triple challenge: historically high home prices,...