If you’re one of the fortunate homeowners sitting on a mortgage rate below 4%, you’ve probably felt “locked in” to your current home. And who could blame you? Trading a 3.5% rate for today’s 6%+ rates feels like financial self-sabotage.
But here’s what’s happening: a growing number of savvy homeowners are finding creative ways to move forward without giving up their golden-age mortgage rates. And they’re building serious wealth in the process.
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The Numbers Tell an Interesting Story
Recent data shows something surprising. Between the first and second quarters of 2025, the share of mortgages below 3% dropped slightly from 20.7% to 20.4%. Even more notable, mortgages in the 3% to 4% range fell from 32.7% to 32.1%.
Where did these lucky homeowners go? They didn’t just disappear. Many are making strategic moves that would have seemed counterintuitive just a few years ago.
The New Home Advantage
Homebuilders are pulling out all the stops to move inventory. We’re talking serious incentives: cash at closing, upgraded appliances, and most importantly, rate buydowns that can reduce your interest rate by half a point or more.
That half-point reduction? It saves buyers roughly $178 per month, or over $2,000 annually. When builders offer these buydowns, some buyers are landing rates between 4% and 6%, making the move financially feasible.
But here’s where it gets really interesting for wealth-building.
The Wealth-Building Strategy Nobody’s Talking About
If you can make the numbers work, keeping your current home with its sub-4% mortgage while purchasing a second property might be one of the smartest wealth-building moves you can make in today’s market.
Think about it: you’re locked into an incredibly low rate that may never return in our lifetime. That’s not a liability—it’s a massive asset. Instead of giving it up to upgrade, consider keeping that low payment and purchasing a second property, even if it’s smaller or more affordable.
Here’s why this strategy is so powerful right now:
Leverage Your Low Rate: Your current mortgage payment is likely hundreds of dollars less per month than it would be at today’s rates. That difference can help fund a second property.
Builder Incentives Make It Possible: With builders offering rate buydowns and other incentives, the cost of entry for a second home or investment property is more manageable than you might think.
Long-Term Appreciation: Real estate historically appreciates over time. Owning two properties means double the potential for wealth accumulation.
Rental Income Potential: If you can’t afford to carry both properties, renting out one can cover most or all of its mortgage payment, especially if you’re the one with the sub-4% rate.
Tax Advantages: Investment properties come with deductible expenses that can benefit your overall financial picture.
The Market Reality
Currently, 80.3% of outstanding mortgages are under 6%, and 70.4% are under 5%. This creates a unique dynamic: most homeowners feel trapped, which keeps housing supply tight.
“Many potential borrowers feel ‘trapped’ by their current rates, and to be honest, quite often their affordability has been very impacted by both rates and higher prices,” notes Sarah DeFlorio, vice president of mortgage banking at William Raveis Mortgage.
But “trapped” is all about perspective. If you can swing it financially, that low rate isn’t a trap—it’s a launching pad.
When Does It Make Sense to Move?
Most experts agree that homeowners with sub-4% rates will only move for compelling reasons: marriage, divorce, children, job relocations, or major life changes.
But there’s another compelling reason that’s emerging: the opportunity to leverage your current position into greater wealth.
If you can afford to:
You might be positioning yourself for significant long-term wealth accumulation. In today’s market, this could be one of the single best strategies for building generational wealth.
Looking Ahead
Economists predict that by the end of 2025, the share of sub-6% mortgages could fall to around 75%. Translation: your sub-4% rate becomes increasingly rare and valuable with each passing month.
The silver lining? Survey data shows that 40% of potential buyers would find a home purchase feasible if rates dipped below 6%, and 32% would jump back in below 5%.
“Once we see a sustained period with rates below 5%, there will be a lot of new inventory as people feel better about their purchasing power,” says DeFlorio.
Important Steps to Rent Your Home Out from A to Z
Step by step checklist for getting a home rented, and link to the full property management guide
1 Consider strengths and weaknesses for your home and location and consider special strategies to utilize them. Is it a college area? If so, you’ll likely handle a lot differently from low income, or a suburb.
2 Get the property in show-ready condition by handling repairs, but also low-cost aesthetic fixes like spray painting rusted AC grates, and other things that really stand out. A sure way to attract sub-par tenants and repel the rest is to show a home with unrepaired issues.
3 Decide whether you’re going to allow pets or not. Before you decide, know that for most landlords it’s the single best thing you can do to increase your “bottom line” profit over the long term. More on this subject here
4 Set a rental rate that will balance a minor amount of time on market hassle, with monthly rate. Whether in the form of owner-occupied showings, stress, or vacancy. Most owners fail to properly account for these subtle but real costs, especially vacancy. Vacant homes are much more costly than most account for. We can provide a free rental rate estimate compiled by people, not an algorithm, here
The Bottom Line
If you’re sitting on a sub-4% mortgage rate, you’re not locked in—you’re locked into an incredible advantage. While giving up that rate to simply upgrade might not make sense, leveraging it to build a real estate portfolio could be one of the smartest financial moves you make this decade.
Not everyone can pull this off financially, and it requires careful planning and calculation. But for those who can make the numbers work, keeping that golden mortgage rate while strategically adding property to your portfolio could be your ticket to serious, long-term wealth.
The question isn’t whether you can afford to move. It’s whether you can afford not to explore how to turn your low mortgage rate into a wealth-building tool.
To read more about this topic, visit Homeowners With Sub-4% Mortgage Rates Are On the Move—and They’re Buying Newly Built Homes.
