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2026 Housing Market Outlook

After a couple of years where the housing market felt stuck in neutral, 2026 may be the year things shift back into gear. Expert forecasts show more people are expected to move – and that could open the door for you to do the same.

More Homes Will Sell

With all of the affordability challenges at play over the past few years, many would-be movers pressed pause. But that pause button isn’t going to last forever. There are always people who need to move. And experts think more of them will start to act in 2026 (see graph below):

a graph of a graph showing the number of the company's salesWhat’s behind the change? Two key factors: mortgage rates and home prices. Let’s dive into the latest expert forecasts for both, so you can see why more people are expected to move next year.

Mortgage Rates Could Continue To Ease

The #1 thing just about every buyer has been looking for is lower mortgage rates. And after peaking near 7% earlier this year, rates have started to ease.

The latest forecasts show that could continue throughout 2026, but it won’t be a straight line down (see graph below):

a graph with numbers and linesThere’s a saying: when rates go up, they take the escalator. But when they come down, they take the stairs. And that’s an important thing to remember. It’ll be a slow and bumpy process.

Expect modest improvement in mortgage rates over the next year but be ready for some volatility. There will be volatility along the way as new economic data comes out. Just don’t let it distract you from the bigger picture: the overall trend will be a slight decline. Forecasts say we could hit the low 6s, or maybe even the high 5s.

And remember, there doesn’t have to be a big drop for you to feel a change. Even a smaller dip helps your bottom line.

If you compare where rates are now to when they were at 7% earlier this year, you’re already saving hundreds on your future mortgage payment. And that’s a really good thing. It’s enough to make a real difference in affordability for some buyers.

Home Price Growth Will Be Moderate

What about prices? On a national scale, forecasts say they’re still going to rise, just not by a lot. With rates down from their peak earlier this year, more buyers will re-enter the market. And that increased demand will keep some upward pressure on prices nationally – and prevent prices from tumbling down.

So, even though some markets are already seeing slight price declines, you can rest easy that a big crash just isn’t in the cards. Thanks to how much prices rose over the last 5 years, even the markets seeing declines right now are still up compared to just a few years ago.

Of course, price trends will depend on where you are and what’s happening in your local market. Inventory is a big driver in why some places are going to see varying levels of appreciation going forward. But experts agree we’ll see prices grow at the national level (see graph below): 

a graph of green rectangular objectsThis is yet another good sign for buyers and overall affordability. While prices will still go up nationally, it’ll be at a much more sustainable pace. And that predictability makes it easier to plan your budget. It also gives you peace of mind that prices won’t suddenly skyrocket overnight.

Bottom Line

After a quieter couple of years, 2026 is expected to bring more movement – and more opportunity. With sales projected to rise, mortgage rates trending lower, and price growth slowing down, the stage is set for a healthier, more active market.

So, the big question: will you be one of the movers making 2026 your year?

Connect with an agent if you want to get ready.

Why Experts Say Mortgage Rates Should Ease Over the Next Year

You want mortgage rates to fall – and they’ve started to. But is it going to last? And how low will they go?

Experts say there’s room for rates to come down even more over the next year. And one of the leading indicators to watch is the 10-year treasury yield. Here’s why.

The Link Between Mortgage Rates and the 10-Year Treasury Yield

For over 50 years, the 30-year fixed mortgage rate has closely followed the movement of the 10-year treasury yield, which is a widely watched benchmark for long-term interest rates (see graph below):

a graph of a graph showing the rise of a mortgage rateWhen the treasury yield climbs, mortgage rates tend to follow. And when the yield falls, mortgage rates typically come down.

It’s been a predictable pattern for over 50 years. So predictable, that there’s a number experts consider normal for the gap between the two. It’s known as the spread, and it usually averages about 1.76 percentage points, or what you sometimes hear as 176 basis points.

The Spread Is Shrinking

Over the past couple of years, though, that spread has been much wider than normal. Why? Think of the spread as a measure of fear in the market. When there’s lingering uncertainty in the economy, the gap widens beyond its usual norm. That’s one of the reasons why mortgage rates have been unusually high over the past few years.

But here’s a sign for optimism. Even though there’s still some lingering uncertainty related to the economy, that spread is starting to shrink as the path forward is becoming clearer (see graph below):

a graph of a chartAnd that opens the door for mortgage rates to come down even more. As a recent article from Redfin explains:

“A lower mortgage spread equals lower mortgage rates. If the spread continues to decline, mortgage rates could fall more than they already have.”

The 10-Year Treasury Yield Is Expected To Decline

It’s not just the spread, though. The 10-year treasury yield itself is also forecast to come down in the months ahead. So, when you combine a lower yield with a narrowing spread, you have two key forces potentially pushing mortgage rates down going into next year.

This long-term relationship is a big reason why you see experts currently projecting mortgage rates will ease, with a fringe possibility they’ll hit the upper 5s toward the end of next year.

Here’s how it works. Take the 10-year treasury yield, which is sitting at about 4.09% at the time this article is being written, and then add the average spread of 1.76%. From there, you’d expect mortgage rates to be around 5.85% (see graph below):

a graph of a chartBut remember, all of that can change as the economy shifts. And know for certain that there will be ups and downs along the way. 

How these dynamics play out will depend on where the economy, the job market, inflation, and more go from here. But the 2026 outlook is currently expected to be a gradual mortgage rate decline. And as of now, things are starting to move in the right direction.

Bottom Line

Keeping up with all of these shifts can feel overwhelming. That’s why having an experienced agent or lender on your side matters. They’ll do the heavy lifting for you.

If you want real-time updates on mortgage rates, reach out to a trusted agent or lender who can keep you in the loop and help you plan your next move.

What Buyers Say They Need Most (And How the Market’s Responding)

A recent survey from Bank of America asked would-be homebuyers what would help them feel better about making a move, and it’s no surprise the answers have a clear theme. They want affordability to improve, specifically prices and rates (see below):

a graph of a couple of circles with textHere’s the good news. While the broader economy may still feel uncertain, there are signs the housing market is showing some changes in both of those areas. Let’s break it down so you know what you’re working with.

Prices Are Moderating

Over the past few years, home prices climbed fast, sometimes so fast it left many buyers feeling shut out. But today, that pace has slowed down. For comparison, from 2020 to 2021, prices rose by 20% in a 12-month period. Now? Nationally, experts are projecting single-digit increases this year – a much more normal pace.

That’s a sharp contrast to the rapid growth we saw just a few short years ago. Just remember, price trends are going to vary by area. In some markets, prices will continue to rise while others will experience slight declines.

Prices aren’t crashing, but they are moderating. For buyers, the slowdown makes buying a home a bit less intimidating. It’s easier to plan your budget when home values are moving at a much slower pace.

Mortgage Rates Are Easing

At the same time, rates have come down from their recent highs. And that’s taken some pressure off would-be homebuyers. As Lisa Sturtevant, Chief Economist at Bright MLS, says:

“Slower price growth coupled with a slight drop in mortgage rates will improve affordability and create a window for some buyers to get into the market.”

Even a small drop in mortgage rates can mean a big difference in what you pay each month in your future mortgage payment. Just remember, while rates have come down a bit lately, they’re going to experience some volatility. So don’t get too caught up in the ups and downs.

The overall trend in the year ahead is that rates are expected to stay in the low to mid-6s – which is a lot better than where they were just a few short months ago. They may even drop further, depending on where the economy goes from here.

Why This Matters

Confidence in the economy may be low, but the housing market is showing signs of adjustment. Prices are moderating, and rates have come down from their highs.

For you, that may not solve affordability challenges altogether, but it does mean conditions look a little different than they did earlier this year. And those shifts could help you re-engage as we move into next year.

Bottom Line

Both of the top concerns for buyers are seeing some movement. Prices are moderating. Rates are easing. And both trends could stick around going into 2026.

If you’re considering a move, connect with a local real estate agent to walk you through what’s happening in your area – and what it means for your plans.

Why Now May Be a Key 2025 Moment To Sell Your House

Mortgage rates are finally heading in the right direction – and buyers are starting to jump back in.

According to the data, buyer demand picked up considerably once mortgage rates hit a new low for 2025. The Mortgage Bankers Association (MBA) reports that applications for home loans were up 23% compared to the first week of September last year.

If you’ve been waiting to sell, or your listing recently expired because the market was slower than you hoped it would be, now’s the time to reconsider your move. Buyer demand is the highest it’s been since July – and you don’t want to miss this window.

When Rates Drop, Buyers React

Here’s what’s happening. The 30-year mortgage rate dropped to 6.13% earlier this week. And that’s the lowest it had been since October 2024. That decline followed weak job growth and other economic indicators that are fueling speculation the Federal Reserve may cut the Federal Funds Rate multiple times this year. Mortgage rates started dropping because financial markets are anticipating those Fed decisions. And that opens the door for more buyers to act.

Since today’s buyers are looking at every angle to make home purchases more affordable, they’re much more sensitive to even the slightest movement in mortgage rates. Basically, it boils down to this. As affordability improves, so does buyer demand (see graph below):

a graph of a graph showing a rise in mortgage rateAnd that’s a change you’re going to feel – in a good way. Since about this time last year, we’ve been in a plateau of “limited” buyer demand. But now that rates are coming down, buyer demand is getting better.

What This Means for You

If you’re looking to move, it’s time to get serious about what’s happening in the market, and how you can use these key moments to your advantage. Maybe you have an expired listing that sat without offers earlier this year, or you held off on selling altogether, thinking buyers weren’t out there. This is your signal – they’re coming back. Now, it’s not in the big surge the market saw a few years ago, but this could be your window.

Here’s the opportunity. You can list, while buyer activity is rising and before more sellers in your neighborhood do too. Other homeowners may not see this shift for a while, so you can get a leg up on your competition if you act now.

On the flip side, if you wait, sure there may be more buyers if rates continue to inch down. But there are also going to be more sellers too. So, why take that risk?

A trusted local agent can help you assess your home’s value, fine-tune your pricing strategy, and make sure it stands out to the serious buyers who are taking action today.

Bottom Line

Buyers are watching rates, weighing their options, and starting to get off the sidelines. If you’re thinking about selling, this may be your chance to get ahead.

Want to make sure your house shows up for the right buyers, at the right time?

Connect with an agent to walk through the steps together so you can make the most of this moment.

Stay informed