PADUCAH — Some homeowners nationwide are struggling with being "locked in" to their mortgages and not being able to afford soaring home prices combined with high interest rates.
As a result, many are "locked in" to their cheaper COVID-era interest rates, when rates were down near 2%.
Some homeowners nationwide are struggling with being "locked in" to their mortgages and not being able to afford soaring home prices combined with high interest rates.
According to the Federal Housing Finance Agency, being "locked in" is impacting peoples' financial decisions like the ability to move, change jobs, adjust insurance policies and sell stocks.
Local realtors said the trend is happening in the area, too. People purchased their homes at lower interest rates in the past, resulting in cheaper mortgages right now.
At Mallard Circle in Paducah, it seems like the housing market is booming; but in reality, inventory is low. Realtor Abby Dority said one reason for that is because potential sellers in the area are staying put in western Kentucky and that's because they're "locked in" to their mortgages.
"It is definitely affecting our inventory," said Dority. "We have not very many houses for sale right now...We are seeing more and more people who would have normally chosen to move that are choosing to stay a little bit longer."
McCracken County PVA Bill Dunn works with deeds on both residential and commercial properties.
McCracken County PVA Bill Dunn works with deeds on both residential and commercial properties.
He said even if people are pre-qualified, set up a home loan and look on housing apps, they may be too late.
"Someone's probably already have a contract, they probably already shown it to 10 people before you even know it," said Dunn.
Dunn said back in 2018, he would process about 20 to 30 deeds a day. Now, it's about five, which shows that the amount of inventory is decreasing in McCracken County.
"There's not many homes on the market for sale so that's the supply side, but the homes are selling very very quickly," said Dunn.
Dority said as the amount of inventory dwindles, buyers are coming to the region.
"We're seeing more and more buyers from more expensive areas who are trying to meet that gap with the interest rates and find affordable places to retire or to raise their children, and so they're coming from areas like Arizona, California, New York, Florida," said Dority.
Dunn said this "locked in" trend is more of a residential housing issue, and does not impact commercial real estate properties.
He also said several areas in McCracken County have had a higher number of deeds processed, meaning more inventory and more development. That list includes the Concord area and the Southside.
