The Stay-Put Economy: Life, Not Rates, Now Freezes the Housing Market

PALO ALTO, CA – May 07, 2026 – For years, the story of the American housing market has been dictated by a single, powerful number: the mortgage rate. But a fundamental shift is underway. Despite a nearly 100-basis-point drop in average mortgage rates over the past two years, fewer homeowners are choosing to move. A new study reveals that personal life circumstances and broader economic anxieties have overtaken interest rates as the primary anchors keeping Americans in their current homes, a trend that is reshaping the real estate landscape and fueling a boom in home renovation.

According to a study released today by home equity platform Point, nearly half (48%) of U.S. homeowners did not consider moving at all in the last 12 months, a notable increase from 41% who said the same two years ago. This growing inertia comes even as mortgage rates have eased from their recent peaks.

The reasons for this housing gridlock are evolving. The share of homeowners who canceled moving plans and cited mortgage rates as a barrier fell to 45%, down from 55% in 2024. In its place, 'life circumstances'—a broad category including job loss, new caregiving duties, or other family situations—are now a deciding factor for 29% of would-be movers, a figure that has nearly doubled from 16% two years prior.

“For years, the story of housing gridlock has been about mortgage rates and home prices, but Point data shows something more fundamental is shifting beneath the surface: life itself is prompting people to stay put,” said Aaron Terrazas, an economist for Point. “When households don't know what next year looks like for their job, their family, or the broader economy, moving stops feeling like an opportunity and starts feeling like a risk."

This phenomenon extends beyond a single study. Broader market data confirms a long-term trend toward longer homeowner tenure. A March 2026 report from Redfin noted that the typical U.S. homeowner now stays in their home for about 12 years, a dramatic increase from the 6.5-year median tenure recorded two decades ago. While the 'mortgage lock-in effect'—where owners with ultra-low pandemic-era rates are hesitant to sell—remains a powerful force, the new data suggests a deeper psychological shift is cementing homeowners in place.

From Moving Up to Improving In

With moving off the table for many, homeowners are redirecting their ambitions and their capital inward. Instead of searching for a new house, they are doubling down on the one they already own. The Point study found that nearly half (49%) of those who decided against moving now plan to renovate. Overall, a striking 65% of all homeowners surveyed intend to undertake some form of renovation project within the next 18 months.

The scale of these projects is significant. Bathroom remodels (31%) and kitchen renovations (27%) top the list, but a quarter of homeowners are planning to expand their home's footprint by building an addition, an accessory dwelling unit (ADU), or finishing a basement. More than a third of these renovators are committing $30,000 or more, signaling substantial, long-term investment in their current properties.

However, wider industry analysis suggests the renovation boom may be nuanced. While the Joint Center for Housing Studies of Harvard University projects modest growth in the remodeling market, major retailers like Home Depot and Lowe's have signaled a slowdown in big-ticket projects that rely on financing. Their reports indicate a consumer shift towards smaller-scale DIY projects and essential replacements, such as roofing or HVAC systems. This suggests that while the desire to renovate is high, the ability to finance major overhauls remains a significant hurdle.

The Widening Equity Access Gap

The pivot to renovation is exposing a critical friction point in personal finance: the 'equity access gap.' American homeowners are sitting on record levels of home equity, yet many struggle to tap into that wealth. According to Point, six in ten homeowners need financing for their planned projects, but for many, traditional avenues are proving too costly or inaccessible.

A third of homeowners who are not planning to use a Home Equity Line of Credit (HELOC) or a cash-out refinance say the interest rates on those products are simply too high. With average HELOC rates hovering above 7%, adding a second monthly payment is unappealing. Furthermore, a cash-out refinance would force homeowners to forfeit their coveted low-rate first mortgages, a non-starter for millions.

“American homeowners are sitting on record levels of home equity, but a meaningful share of the population is locked out of accessing that wealth,” said Eddie Lim, co-founder and CEO of Point. “Whether it’s the inability to sell, or the inability to get affordable financing, traditional paths to home equity just aren’t working for a lot of people right now."

New Financial Tools Face Growing Pains

This gap has created an opening for alternative financial products like Home Equity Investments (HEIs). Companies like Point, Hometap, and Unison offer homeowners a lump sum of cash in exchange for a share of the home's future appreciation. The key appeal is the absence of new monthly debt payments or interest, with the investment typically repaid when the home is sold.

These products are gaining traction. By late 2024, the largest HEI originators had securitized over $2.5 billion in contracts. However, this emerging market is also attracting significant regulatory scrutiny.

The Consumer Financial Protection Bureau (CFPB) issued a report in early 2025 highlighting potential consumer risks, noting that complex contract terms and valuation methods could make some HEIs more expensive than traditional loans. The debate over whether HEIs are 'contracts' or should be regulated as 'loans' is intensifying. Several states, including Illinois, Maryland, and Connecticut, have already passed laws to treat HEIs as mortgage products, subjecting them to stricter licensing and consumer protection statutes.

As homeowners navigate a complex economic climate by staying put and investing in their properties, the financial tools available to them are also in a state of evolution. The demand for flexible, debt-free equity access is clear, but the long-term shape of this new market will ultimately be forged by the interplay between innovation, consumer demand, and regulatory oversight.