Over the last month, the slumbering housing market has stirred ever so slightly. According to the National Association of Realtors, existing home sales rose 0.8% from April to May. Despite the monthly uptick, sales remain down year-over-year and are still well below the highs seen during the pandemic-era boom.

What’s the reason? Well, renting isn’t looking so bad right now — for both buyers and sellers.

Even though buying a home isn’t as popular as it was during the pandemic, prices still remain high. The median national sales price for a home sold in May was nearly $423,000 — a record high for the month.

Meanwhile, rents have stabilized or even declined in some cases.

“Anytime when you have more stable rents, or in some markets, like Austin, Texas, Jacksonville, where rents are actually falling, it doesn't provide urgency to look for purchasing a home,” said Lawrence Yun, an economist at the National Association of Realtors.

If renters don’t expect a price spike when their lease renews, locking in a high mortgage payment for the next 30 years can lose its appeal. Plus, who wants to fork over their life savings for a downpayment when the economy feels so uncertain?

“Similarly to businesses, we've seen in consumer data that consumers are holding off big decisions as well,” said Selma Hepp, an economist at the real estate data company Cotality. “So, whether you know they were renting, and they've been thinking about buying, they may hold off on that.”

Sellers are also hesitating — but for different reasons. Many homeowners are sitting on ultra-low mortgage rates of 2% or 3% that they locked in during the pandemic. Rather than give up those rates, some are choosing to rent out their homes instead of selling them. Yun calls them “incidental landlords.”

“They don't want to give up those low-interest rate environments, and the rents they can extract are much higher than the mortgage payment obligations,” Yun said.

So for now, a lot of people — buyers and sellers alike — are holding back. Whether it’s locking in a high mortgage or giving up a low one, the math just doesn’t work for everyone. Renting, at least for the moment, feels like the safer bet.