Why Houses Aren't Selling — And What That Means for the Columbus Rental Market
The national housing market is thawing, but slowly. Existing home sales ran at a 4.17 million annualized rate in May 2026 — the highest level since December, up 3.2% both month-over-month and year-over-year — but still well below the 5 million-plus pace that characterized a healthy market pre-2022. Millions of homeowners who would normally be selling are staying put. They're not stuck because they don't want to move. They're stuck because of a number on a piece of paper most of them signed between 2020 and 2022.
This piece explains the mortgage lock-in effect, why the national market is slowly recovering while remaining historically constrained, why Columbus is running its own cycle inside the national one, and — most importantly for our owner clients — what all of this means for the rent-versus-sell decision in the second half of 2026.
The Lock-In Effect, Explained With Real Math
Between 2020 and 2022, an unprecedented share of American homeowners either bought or refinanced into 30-year fixed mortgages at rates below 4%. Many locked in below 3%. Selling that home today, at the current 30-year fixed rate of 6.43% (Freddie Mac Primary Mortgage Market Survey, week ending July 2, 2026), means giving up that low-rate loan and taking on a new mortgage at more than double the cost of capital.
The published research on this effect is unambiguous. A homeowner who took out a $400,000 mortgage at 2.9% in December 2020 has roughly $355,000 remaining today. Refinancing that balance into a new 30-year fixed loan at 6.43% raises the monthly payment by approximately $681 — a 41% increase in monthly housing cost for the same house. Expressed in present-value terms, the homeowner would absorb roughly $103,000 in additional financing cost over the remaining life of the loan by making that trade.
Scale that down to a typical Columbus, Georgia property. A homeowner who purchased at $230,000 in December 2020 with 10% down (roughly $207,000 borrowed at 2.9%) has approximately $184,000 remaining. Refinancing that balance at 6.43% raises the monthly payment by roughly $355. Over the remaining loan term, the present value cost is roughly $53,000 — real money to trade for the same house.
The behavioral consequences are what shape the market. A Bankrate survey found that 41% of homeowners paying below 3% say they wouldn't consider buying a new home at any rate — a categorical statement about the trade nobody wants to make. Real estate agents in market-tracking surveys have consistently identified rate lock-in as a major or moderate factor holding listings off the market for four years running.
The lock-in doesn't dissolve quickly. The average outstanding U.S. mortgage rate has crept from 3.8% in Q2 2022 to roughly 4.5% today, and research from Compass and other housing analysts estimates that the lock-in effect will prevent roughly 870,000 home sales this year alone, declining to 820,000 next year as some owners refinance, move for non-discretionary reasons, or accept the trade.
This is why the market is running at roughly 80% of its pre-2022 pace even as sales climb month over month. It's not going back to normal until the lock-in unwinds, and that unwind is a decade-long process, not a rate-cut event.
The Rate Path Isn't Rescuing Anyone Soon
Anyone waiting for the Federal Reserve to lower rates enough to make lock-in irrelevant should reset that expectation.
The FOMC held the federal funds rate at 3.50%–3.75% at its June 17, 2026 meeting — the fourth consecutive hold, and the first meeting under new Chair Kevin Warsh. More importantly, the committee's updated dot plot moved decisively hawkish: the median year-end 2026 rate projection climbed from 3.4% to 3.8%, and 9 of 18 policymakers now project at least one rate hike over the remainder of the year. Only one policymaker expects a cut. The remainder hold.
The Fed also raised its 2026 inflation projections: headline PCE inflation now expected at 3.6% (up from 2.7% in March), core PCE at 3.3%. Inflation is proving more persistent than earlier projections assumed, and the Fed appears prepared to keep policy restrictive to bring it down.
The 30-year fixed rate is unlikely to fall meaningfully below 6% while the Fed maintains this posture. Fannie Mae and the Mortgage Bankers Association both project rates in the mid-6% range through 2027. The lock-in problem is going to persist because the rates that would resolve it aren't coming back.
Columbus Is Running Its Own Cycle
Now the local view. The national data describes averages; individual markets diverge from those averages based on price point, demand drivers, and demographic composition. Columbus, Georgia is one of the diverging markets.
Columbus market data, June 2026:
- 216 homes sold in June 2026, compared to 177 in June 2025 — up roughly 22% year-over-year
- Median sales price: $239,000
- Median days on market: 60, down from 67 a year earlier
- Median price per square foot: approximately $135, up 6.3% year-over-year (Redfin)
Two structural factors explain why Columbus is transacting when the national market is constrained:
Price point. Most Columbus homes trade between $180,000 and $280,000. At $239,000 with 10% down and a 30-year fixed at 6.43%, the monthly principal-and-interest payment on the balance is roughly $1,346. Add taxes and insurance and the full PITI lands in the $1,700–$1,900 range — inside the BAH band for E-6 through O-4 military tenants. Buyers can afford these homes even at current rates because the absolute payment is manageable. In markets where the median price is $500,000, the payment math breaks the buyer pool.
Non-discretionary demand. Fort Benning's PCS cycle generates housing demand that doesn't wait for rate cuts. When a service member gets orders to report to Fort Benning in October, they need housing in October. When a service member departs in July, their home goes on the market — for rent or for sale — in July. The military doesn't respond to Fed policy. It responds to assignment orders.
The composition of the market has still shifted, though, and this is the piece that shapes rental demand. Owners with sub-3% mortgages who could sell but aren't forced to are staying put and either living in the home or converting to rentals. That thins for-sale inventory in the middle of the market and pushes households into rentals. Two flows feed rental demand simultaneously:
- Priced-out buyers become tenants. Households who would have bought in 2020 at 3% are now unable or unwilling to buy at 6.43%. They rent.
- Locked-in owners with PCS orders become landlords. Rather than sell into the current rate environment and give up cheap leverage, they hold the asset and rent it out.
That second flow is our client base. It's also consistent with our 2022 survey of 80 military families: 74% owned or had owned a home during active duty, 70% told us BAH did not comfortably cover their full housing cost, and 90% lived off-base. The renter pool is stable, budget-constrained, and structurally recurring.
The Rent-Versus-Sell Decision, Quantified
For a Fort Benning-area owner sitting on a 2020–2022 mortgage rate and facing a PCS or life-stage decision, this environment fundamentally changes the math.
Your low rate is an asset only if you keep the loan alive. Renting the home out preserves a 3% cost of capital that no investor can replicate today. Selling and reinvesting the proceeds means giving up the cheapest leverage of the last generation.
A worked example at Fort Benning rents:
An E-6 with dependents receives BAH of $1,977 per month (2026 rates, MHA GA075). Assume a Columbus SFR purchased in 2021 at $230,000 with a VA loan at 2.9%. Current PITI: approximately $1,300 per month (principal, interest, property tax, insurance).
If the property rents at BAH-band pricing near the top of the range (say $1,900), the true cash flow math looks like this:
| Line item | Amount |
|---|---|
| Gross monthly rent | $1,900 |
| Less: PM fee (10%) | −$190 |
| Less: Capital reserves (5%) | −$95 |
| Less: PITI | −$1,300 |
| True monthly cash flow | $315 positive |
That property preserves the 2.9% cost of capital, generates positive true cash flow, benefits from continued mortgage paydown by the tenant, and preserves optionality if the owner returns to Fort Benning on a future assignment.
The counterweight — the Mortgage Trap. This math works because the mortgage was written at 2.9%. It would not work at a 2023–2025 mortgage rate. An owner who bought the same property in 2024 at 7.0% has a PITI closer to $1,700–$1,750 — well above the $1,900 rent achievable in the market. That property produces negative true cash flow at market rents, and the Mortgage Trap becomes real.
The interest rate environment is not just a national headline. It's the load-bearing variable in every individual rent-versus-sell decision. Our Personal Hurdle Rate framework walks through the full four-path decision tree — hold, sell, refinance, or 1031 exchange — for owners with more complex portfolio decisions.
The VA Loan Wrinkle Almost Nobody Mentions
One structural feature of VA loans changes the sell-side math for military owners in ways most conversations miss: VA loans are assumable.
A qualified buyer — typically another service member with sufficient VA entitlement — can assume the existing VA loan, taking over the original interest rate and remaining balance. On a 2021 VA note at 2.9%, that assumability is a marketable asset. In a market where new buyers face 6.43% rates, a qualified VA-eligible buyer who can assume a 2.9% rate is receiving a substantial financial gift built into the property sale.
Two honest caveats:
- Your entitlement is tied up until the assuming buyer's own VA entitlement covers the loan. If the buyer is not VA-eligible or has insufficient entitlement to substitute for yours, your entitlement remains encumbered until the loan is paid off. This can matter if you plan to use your VA benefit for a future home purchase.
- Lender processing timelines vary. Some VA-approved lenders process assumptions in 45–60 days; others take longer. Confirm your loan servicer's assumption process before listing the property with assumption as a selling point.
For a military owner facing the sell-versus-rent decision, VA assumability creates a real third option that non-VA borrowers don't have: sell the property to a buyer who takes over the low rate, effectively monetizing the value of that rate rather than walking away from it. Talk to your lender about assumption mechanics; we'll run the rental side of the analysis at no charge.
The Bottom Line
The housing market isn't broken. It's repriced. The lock-in effect is a structural feature of the environment that shapes owner decisions for years, not months, and doesn't resolve until rates come down materially or until owners' non-discretionary life events force sales anyway.
For Columbus specifically, the local price point and the Fort Benning PCS cycle keep the market transacting even as national volume runs below its historical norm. And for military owners holding 2020–2022 mortgage rates, the current environment makes the rent-versus-sell math meaningfully different from what it looked like in 2019 or in 2027.
If you're holding a low-rate mortgage and PCS orders, you're holding the cheapest capital you'll ever have. The question isn't whether to preserve it — it's whether the rent supports keeping it. That's a math question, and it's one we run every day.
If you have a Fort Benning-area property and want the rent-versus-sell math run on your specific numbers, request a free rental analysis at 5pre.com/columbus-property-management-military. We'll pull comps, calculate true cash flow at current BAH bands, and give you a defensible number within 48 hours.
One last operational note on timing: even in a normal market, listing math still favors moving before August 15. Peak PCS season means approximately 21 days on market at the high end of the rent range. Miss the window and you're looking at approximately 41 days on market at the low end of the range. That gap is real money on top of every other consideration.
