Homeowners who want to move feel 'stuck' 

A new national survey found a vast majority of people who want to move in 2023 don't think they'll be able to because of high mortgage rates and home prices.

The Point Homeowner Sentiment and Moving Survey indicated that 90% of those who want to move in 2023 feel "stuck" due to financial issues. Of those who don't expect a move to happen, 42.4% cited high interest rates as the problem, while 31% said high home prices were a barrier.

Point, a home equity investment platform, surveyed 1,066 homeowners to come up with its results. Of those surveyed, 22% indicated that they wanted to move in 2023.

"It's no secret homeowners are hunkering down as high mortgage rates and persistently high home prices stymie affordability, but it's surprising to see just how many feel stuck — and how few choices they seem to have when it comes to tapping into the value in their current homes," said Eddie Lim, Point co-founder and CEO. 

"We may be seeing a very different home shopping season in 2023, with even more constrained inventory if current homeowners don't feel like they can leave their current home."  

The survey was conducted in November when interest rates were at 7% and showed little sign of going down. Mortgage interest rates have subsequently dropped, averaging 6.33% in early December.

Rates in the 5-6% range could spur more moves

Lim doesn't think it would take a big drop in mortgage rates to "unstick" some of the homeowners who want to move but are concerned about mortgage rates. In the survey, only 10% of hopeful movers said rates between 6-6.9% would make them consider a move, but nearly 23% would feel more confident about rates in the 5-5.9% range. Many economists are predicting that rates will settle between 5% and 6% sometime in 2023. 

A substantial number of would-be movers were still hoping for a much lower mortgage rate before they'd make a move: 37.8% would consider moving if mortgage rates got below 4%, and more than 17% were holding out for rates below 3%.

While economists aren't expecting mortgage rates to fall into the 3-4% range anytime soon, the company said that based on historical patterns, homebuyers do feel more confident buying around 5.5%.

Those concerned about home prices want to see a significant drop before they would consider moving. According to the survey, 53.5% said they would want prices to fall more than 5% before they could be convinced to sell their place and move.

Renovations a popular option while waiting out the market

With homeowners feeling stuck in their homes for the time being, 59% of those surveyed said they want to do renovations. Because interest rates are up, nearly 55% of those who want to do some remodeling intend to pay in cash, while 13.5% plan to dip into a home equity line of credit. Only 11.4% plan to use credit cards.

"I suspect the housing market will continue in this kind of limbo throughout the winter, but the good news is that these homeowners are sitting on record equity," said Lim. "If people are making a choice to stay in their current homes, renovations are the next natural choice."