U
.S. housing trends are easing, yet buyers should not expect dramatic relief in 2026, says Realtor.com’s senior economic research analyst Hannah Jones. She forecasts that home inventory will keep climbing while mortgage rates dip modestly to roughly 6.3 %—a slight decline from the 6.6 % average seen in 2025. Although the drop is small, it signals a marginally more buyer‑friendly market. Jones cautions that the sector won’t “turn a big corner” this year.
The modest rate fall translates into a 1.3 % reduction in monthly payments, a change that may be barely noticeable but still a positive shift. Even with lower borrowing costs and a modest inventory uptick in some regions, the overall price of homeownership remains prohibitive for many households. The affordability crisis persists, as the pandemic‑era bidding wars pushed prices to record highs while subsequent rate hikes made payments painful. Those who secured ultra‑low rates before the surge have largely stayed put, tightening supply and keeping prices elevated despite softer demand.
Current data reveal that 52.5 % of mortgages are still below 4 %, 70 % under 5 %, and 80 % at 6 %. Buyers are reluctant to abandon these favorable rates, which keeps the market sluggish. Jones notes that the slight rate changes will spur more activity than the past two years, but most moves will be driven by necessity rather than opportunity. A landslide of purchases is unlikely; however, regions with more attractive price dynamics—particularly the West and South—are expected to see a modest uptick in new buyers.
Nationally, home prices are projected to rise about 2 % in 2026, mirroring 2025 levels. Yet the picture varies sharply by region. In the South and West, inventory is up roughly 50 % above pre‑pandemic levels, creating softness in many metros and exerting downward pressure on prices as new construction flows through the pipeline. Conversely, the Midwest and Northeast remain tight, with inventory 30‑50 % below pre‑pandemic figures, sustaining upward price pressure. The lack of recent construction in these areas limits recovery, prompting some buyers to relocate in search of affordable homes.
In short, the U.S. housing market is inching toward balance. Mortgage rates will ease slightly, inventory will rise, and prices will remain largely flat nationally, with regional disparities persisting. Buyers holding onto low rates will continue to hold out, and while some movement is expected—especially in the West and South—the overall market will not experience a dramatic turnaround in 2026.
