What to Expect from the Housing Market in 2026
- PBM Marketing
- 12 hours ago
- 3 min read
Thinking about buying, selling, or refinancing in 2026? Understanding the state of the housing market is a good place to start.
Fortunately, 2026 is shaping up to be full of opportunity. Mortgage rates are expected to ease, inventory is rising, and the market is gaining momentum. Here’s what experts predict* — and how to turn those trends into your advantage.
Falling Mortgage Rates
After a year of relatively high rates, relief is on the horizon. Fannie Mae predicts mortgage rates will dip below 6% by the end of 2026.[1] The Mortgage Bankers Association (MBA) expects rates to hover in the 6% to 6.5% range, with occasional dips that could spark bursts of activity.[2]
That’s a big shift from 2025, when average rates hovered in the high 6% range for many months and even reached 7%. Those higher rates kept many potential buyers on the sidelines and made homeowners hesitate to sell or refinance.[3]
Lower rates in 2026 could have a ripple effect across the housing market:
Buyers will benefit from improved affordability and more buying power.
Sellers may be ready to list after years of holding on to low pandemic-era rates.
Homeowners could refinance to lower their monthly payments or free up cash for
other goals.
Stronger Home Sales
With affordability improving, expect the market to pick up speed. Fannie Mae projects a 9% increase in new- and existing-home sales,[1] while the MBA expects home loan activity will rise by 7.7%.[2]
As more buyers enter the market, competition is likely to intensify, especially in areas with limited inventory. Planning ahead can help you move quickly and confidently when the moment is right for you.
Mixed Price Trends
In 2025, some markets saw price growth while others faced stagnation or even decline. The Northeast and Midwest saw the strongest price growth due to ongoing inventory shortages, while states like Florida, Colorado, and Texas experienced price drops as supply increased.[3]
Improved affordability in 2026 could fuel competition among buyers, pushing prices higher in areas where inventory is tight. Conversely, areas with greater supply may see prices hold steady (rather than drop) thanks to stronger demand. The bottom line? Expect a more balanced market overall, but local trends will play a big role.
What This Means for You
If You’re Buying: Start Your Home Search Early
Lower rates will increase demand. Early buyers can benefit from better pricing and less competition.
First Step for Buyers: Get Pre-Qualified
Before you start looking at houses, talk to your Loan Officer about pre-qualification. This will help you understand your budget and how much house you can afford. Your Loan Officer can also help you:
Find the right loan program to fit your needs
Estimate the cash needed to close
Identify financial steps you can take now to strengthen your application
If You’re Selling: Prepare Your Home Now
Sellers who start clearing the clutter and making repairs now will be well-positioned to take advantage of the spring market.
First Step for Sellers: Know Your Home’s Market Value
Work with a local lender or real estate agent to get a professional estimate. Online tools can provide a ballpark figure, but they may miss the nuances of your neighborhood and property features.
If You’re Staying Put: Consider Refinancing
It rates drop, you may be able to save on your monthly mortgage payment. But a refinance can get you so much more than a lower rate. Refinancing can help you access cash from your home’s equity to pay for renovations or meet other life or financial goals.
First Step for Homeowners: Know Your Target Rate
Start by talking to your Loan Officer to determine the rate that makes refinancing worthwhile. When rates hit your target, be ready to act by quickly gathering documentation like tax forms, pay stubs, and bank statements
2026 could be your year to make a move. Whether you're buying, selling, or staying put, start planning now so you’re ready when the right opportunity comes along. And remember — we’re here to help every step of the way.