gold·en hand·cuffs
/ˈɡōldən ˈhan(d)ˌkəfs/
“Golden Handcuffs”: when a homeowner is locked into a low interest rate and disincentivized to move to a home with a higher rate.
Let’s talk about how the phenomenon of Golden Handcuffs is impacting our East Bay market!
But first, is it really that bad (cue: tiny violins)?
Homeowners locked in at a low interest rate report very mixed feelings. No one likes being “locked in” to anything…there’s something about the American spirit that wants to be free!! And feeling backed into a corner (even for a good thing, like a low interest rate) can feel icky. Setting aside some big feelings, those who feel unable to move can be stuck in a physical space or location that just doesn’t work for them anymore. A job change that points your commute in a different direction, a growing or shrinking family, and retirement are all reasons why Golden Handcuffs can feel particularly tight.
There are so many upsides to home ownership (even if it’s not the perfect fit), and having a roof over your head at a relatively low cost for those in a sub-3% mortgage is enviable to some. But we recognize that tolerating a home that no longer fits your life can only last for so long.
What is there to do?
If you’ve taken stock of your life needs and staying put for a little while longer is in the cards, it may not be a bad idea to hunker down! Far be it for us to encourage a move prematurely. No home is 100% perfect, so appreciating what you have is sometimes the name of the game.
And if it’s just time to GO, you have some viable options:
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Talk to your financial advisor, your lender, and your Realtor. This is the dream-team in your corner, ensuring you make the big life choices that fit your long-term goals. The team may encourage you to stay put and save up for just a little bit longer, or they’ll say “6.75% interest rate in your new home? You got this!” You may be delightfully surprised
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Consider an out-of-the-box option…would it be possible to qualify for a second mortgage to purchase your next home and convert your first home to a rental property? Given the historically low interest rates that many enjoy, it may be possible to turn your present home into a cash-flow positive investment
We help about a dozen folks each year moving from House A to House B, and there are no two paths that are exactly the same. We’re happy to sit down for a chat to talk about how to design your big move, especially if it feels daunting.
And if you don’t presently own a home and think the Golden Handcuffs “problem” sounds good to you? Well, here’s the good news…our market is ripe with opportunity! Don’t fear. As of press our small but mighty team has helped 18 buyers find their new home in 2025. Might you be next?
