Americans moved less last year, then past 6 decades.

Why?

It certainly wasn't due to a shortfall of inventory choices.

It certainly wasn't due to interest rates being too high.

I think it was a combination of:

1. Fear that prices would continue lower, and
   
2. Banks changing lending practices limiting buyers ability to borrow.
   

This kept buyers from buying, and those buyers that were buying a resale, affected those sellers from moving. As the market prices continued downward, causing sellers to lose equity, the choice became simple for many sellers. DON'T SELL. The difference between this year's percentage of Americans moving and previous decades is: Sellers that didn't have to sell, didn't sell. Whether they tried or not. Those that did have to sell, sold for discount and/or a loss.

The speculation is that many of the Baby Boomer population, that are empty nesters now, should be downsizing.  But because they are losing equtity, they are the ones that are deciding to hold tight and not move. Since this demographic makes a large piece of the population pie in America, this theory may be the right on point. But, I think it is just a small part of the puzzle. Because everyone will move or sell for the right price. Therefore, drilling down deeper, the true reason is buying power. Buyer's don't have power, because fewer banks are lending them money, and they are afraid prices will fall, so they sit on their hands until confidence comes back.

The normal level of people moving for the last decade has been around 13%. Which is still lower than previous decades. I feel that is due to the incredible low interest rates since Sept 11. People were comfortable in their loans, and less antsy in their homes.

But in 1951 and 1984 the level reached approximately 21%. Both followed stagnation and depressed eras. Could we see another shift of moving similar to the previous 30 year cycles? Especially, with pent up demand, low interest rates and prices that have rolled back by nearly half in many of the nation's most popular cities? Start reserving your UHauls, because I think the people are prepared to pack.

Link to MSNBC article