The mortgage rate lock-in effect continues to keep a hold on the housing market, delaying relief in the constraints on existing inventory, according to the latest data from Realtor.com®.
Realtor.com’s Q4 2025 Outstanding Mortgage Data report broke down the current shares of rates in outstanding mortgages as follows:
| Outstanding Mortgage Rate | Q4 2025 Share of Mortgages |
| Less than 3% | 19.7% (down 0.3 percentage points from Q3) |
| 3% to 4% | 30.9% (down 0.6 percentage points) |
| 4% to 5% | 16.8% (down 0.3 percentage points) |
| 5% to 6% | 10.6% (up 0.4 percentage points) |
| Above 6% | 21.9% (up 0.7 percentage points) |
(Source: FHFA National Mortgage Database)
Adding it all up, 50.6% of outstanding mortgages have rates 4% and below, and 78% are below 6%. However, while the share of mortgages with rates above 6% only sits at 21.9%, that share has grown 3.9 percentage points year-over-year, which Realtor.com Senior Economic Research Analyst Hannah Jones characterized as a “meaningful year-over-year acceleration driven by sustained buyer activity despite elevated borrowing costs.”
Jones noted that buyers who locked-in pandemic era low rates “are not yet at a natural payoff or move horizon,” and the lock-in effect remains “durable,” only seeing “gradual erosion.”
“Even in today’s high-price, high-rate market, homebuying activity around major life events, such as having kids, a job change or a divorce, keeps the market in motion,” she continued. “Easing inflation and mortgage rates will be key drivers of seller activity as well, which will relieve some of the price pressure and competition in today’s under-supplied market.”
Looking at payments, the monthly mortgage payment crossed over the $2,000 threshold, what Jones described as the “floor on affordability pressure,” for the first time in Q4 2025. The average payment clocked in at $2,005, which, compared to $1,390 in early 2021, is a 44% increase in about four years.
This new peak in payments is another contribution to rate lock-in, as Jones noted that “new borrowers entering the market today face substantially higher payments than the existing portfolio average implies, which is keeping many potential sellers locked in place.”
Also demonstrating the persistence of the rate lock-in effect, data showed a larger share of mortgages aged between five and seven years, now at 38.4%, which the report notes is the highest share in the data’s history. In comparison, this share was 11.8% in Q4 2023, marking a 26.6 percentage point increase in two years.
“The Covid cohort is holding steady as their rates are too low and their equity too substantial to motivate a move, and new entrants are trickling in slowly,” explained Jones. “Until rate relief is sufficient to unlock meaningful seller activity, this tenure distribution will continue to concentrate in the five- to seven-year range.”
