2026 Housing Market Forecast: Rates Near 6%, Prices Up 1–4%

Forecasts from NAR, Redfin, Realtor.com, and Zillow suggest the 2026 housing market may improve gradually, with mortgage rates expected to stay in the low-6% range and home prices projected to rise at a modest pace. However, the outlooks differ on how much sales and inventory will rebound.

NAR

NAR said the national housing market is entering a clearer recovery phase. It projected that existing-home sales will rise 14% and new-home sales will increase 5%, helping drive a 4% increase in home prices. NAR said 2026 will be the year when higher sales become more visible and stressed that there is no risk of a nationwide home-price decline. It cited a resilient job market as a reason more buyers will follow through with purchases.

NAR also said mortgage rates are expected to decline gradually, improving buying conditions even without a sharp drop. It projected an average mortgage rate of about 6% and said rates are not likely to return to the 3% level seen during the pandemic. NAR added that even a small rate decline could release pent-up demand, suggesting a large pool of potential buyers remains on the sidelines.

Redfin

Redfin described the national market as moving through a long, gradual normalization process rather than a short-term correction or recession. The company said a “housing market reset” is underway, with a slow recovery in transactions and stabilizing prices expected over the next several years. Redfin also forecast that, for the first time since 2008, income growth could again outpace home-price growth.

For 2026, Redfin projected mortgage rates will average around 6%, helping improve affordability. It forecast that the national median home price will rise 1% from the prior year. It also said buying conditions should improve as wage growth outpaces home-price gains, restoring real purchasing power. Redfin projected existing-home sales will rise 3% to an annualized pace of 4.2 million.

Realtor.com

Realtor.com said mortgage rates are expected to remain elevated, but that rising household income and a modest inflation rate could slightly improve buying conditions. Its economic research team projected the average 30-year fixed mortgage rate will be 6.3%.

Realtor.com forecast that home prices will rise 2.2%, but said that increase would be smaller than projected inflation and income growth, which would improve real buying power. It projected household income will rise by at least 3.6%, while inflation will stay in the 3% range.

It also expected the recovery in home sales to remain limited. Realtor.com projected total transactions will rise 1.7% to 4.13 million, still well below the 2013–2019 annual average of 5.28 million. It forecast new-home construction will increase 3.1%, and existing-home inventory will rise 8.9%, marking a third straight year of inventory growth.

Zillow

Zillow said the housing market is likely to move into a more stable phase. It projected home prices will rise 1.2% over the year and said mortgage rates will not fall below 6%, instead declining modestly and then settling into a stable range.

Zillow said improved buying conditions seen last year could carry into 2026, creating an environment where some buyers who had been unable to enter the market may begin moving again. It projected existing-home sales will rise to 4.26 million, a 4.3% increase from the prior year. The company said demand held back by tight supply and high rates in recent years could start to ease into the market more steadily.

By contrast, Zillow projected new single-family home construction will fall back to pre-pandemic levels, making it one of the weakest years in recent years. It said many builders with significant inventories of completed or in-progress homes are likely to hold back on starting new projects.

BY HOONSIK WOO [woo.hoonsik@koreadaily.com]