Many workers are feeling 'golden handcuffs' not from employer perks but from low mortgage rates. Homeowners are reluctant to move, having locked in rates 2.5% lower than current levels. A mortgage shift from 3% to 7% can result in an additional $1,000 monthly on a $400,000 loan, making job switches and promotions seem financially reckless. This trend is amplified by declining job-switch salary increases, further discouraging mobility, as many homeowners find themselves unable to pursue better opportunities because of the significant housing costs.
The average interest rate on existing home loans is 2.5% lower than what new buyers face today, making moving financially reckless.
From 2020 to 2022, millions of Americans locked in low mortgage rates, now influencing their decisions to forgo job offers and promotions.
Job switchers are seeing smaller pay bumps now; the typical raise from job hopping for those making over $100,000 is only 6% to 7%.
Relocating for work might offer career advancement, but rising home prices and interest rates make it too expensive for many.
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