The housing market is so tight because 90% of homeowners were locked into lower mortgage rates before last year's spike

A Redfin report found that 91.8% of US homeowners with mortgages have interest rates below 6%.

This is slightly below the record of 92.9% achieved in 2022.

Many homeowners are unwilling to part with lower rates they secured before the boom, keeping inventory low.

The housing market's tight inventory doesn't appear to be getting much better anytime soon, according to a Redfin report Wednesday.

That's because 91.8% of U.S. homeowners who have a mortgage pay interest on it below 6%, locking in cheap financing before rates spiked around the middle of last year.

The number of homeowners with mortgage rates below 6% is just below the record high of 92.9% reached in mid-2022.

With the average 30-year fixed-rate mortgage reaching 6.71% this week - close to the highest level in two decades - most American homeowners are unwilling to wade into the market and deal with financing the purchase of a new home at a higher rate.

In fact, 82.4% of homeowners have a mortgage rate below 5% and 62% have a rate below 4%, according to Redfin. It should be noted that 23.5% of homeowners have a mortgage rate below 3%, almost the highest rate with such a low rate.

According to Redfin, the statistics are the main reasons for the lack of new home listings. The number of new homes recently listed, as well as the total number of listings, both fell to the lowest recorded for this time of year.

This data is fueling competition among Americans looking to buy a home, and it is also preventing house prices from falling.

With mortgage rates still high and likely to rise further, this could mean fewer and fewer existing homeowners choosing to sell and re-enter the market. And without additional inventory, the bubble in US house prices can continue to grow.

Edward Seiler, the Mortgage Bankers Association's associate vice president of housing economics, told Insider in a recent interview that the housing market has never been more unaffordable for new buyers.

The payment index of the group's purchase requests reached a peak in June, which suggests a decrease in borrowers' affordability conditions due to increased loan amounts, increased rates or decreased profits.

"For new home buyers, this is the worst situation since the end of the Great Recession," Seiler said. "Current homeowners who are lucky enough to receive an interest rate of 2.75% in 2022 are in a great position, but for new home buyers looking to purchase a first home, or those looking to move to another home, this is a very daunting proposition."