US Housing Resilience: Why Higher Mortgage Rates Aren’t Crippling Consumers

Janus Henderson portfolio managers John Kerschner and Nick Childs analyze whether elevated mortgage rates are significantly weakening US household finances—and conclude the overall impact is less severe than headlines suggest.

• Only a small share of households transact annually, meaning over 95% are shielded from current affordability pressures.

• The fixed-rate structure and flexibility of US mortgages allow borrowers to refinance opportunistically, dampening rate hike effects.

• Most homeowners aren’t “house poor,” supported by higher incomes and locked-in low rates from 2020–21.

For income-seeking investors, the report highlights relative value in ABS, RMBS, and agency MBS amid muted prepayment risk and stable household leverage.