Expert Forecasts Point to Affordability Improving in 2026 

If you’ve been wondering what to expect from the housing market in 2026, you’re not alone! For the past few years, affordability has been the biggest hurdle for buyers and sellers alike. Many people have been waiting on the sidelines, hoping conditions would improve.  The good news? They are. 

In fact, affordability in 2025 was the best it’s been in three years and experts agree that momentum is expected to continue into 2026. Their outlook is based on three key factors shaping the market ahead: mortgage rates, housing inventory, and home prices. 

Lower Mortgage Rates Are Already Here 

Mortgage rates have come down from their recent peak - by nearly a full percentage point over the past year. That shift may sound modest, but it can make a meaningful difference in monthly payments and overall buying power. 

So where do rates go next? Forecasts suggest they’ll largely stabilize, hovering in the low 6% range throughout 2026 (see graph below). 

Where rates move from here will depend on the broader economy, job growth, and future decisions by the Federal Reserve. What matters most is that rates are already lower than they were a year ago, creating better conditions for anyone planning a move in 2026. 

• For buyers: Lower rates can reduce monthly payments and expand purchasing power. 

• For sellers: Rates in the 6% range may be the new normal — and many moves are still very doable, especially with accumulated equity. 

More Homes, More Options 

Housing inventory made meaningful progress in 2025, rising about 15%. As more homes came on the market, buyers gained something they hadn’t had in years: more choices, more time, and more negotiating leverage. That shift helped restore balance and slow rapid price growth. 

Looking ahead, experts at Realtor.com project inventory will continue to improve, with supply expected to grow another 8.9% (see graph below). 

• For buyers: More options and increased negotiating power. 

• For sellers: Pricing strategically will matter more than ever. 

Home Price Growth Is Slowing — Not Reversing 

With inventory improving, price pressure has eased. While most experts agree home prices will continue to rise nationally in 2026, the pace is expected to be far more sustainable. On average, prices are forecast to increase by about 1.6% (see graph below). 

That’s important context amid online claims predicting major price drops. While conditions will vary by location - some markets may see modest declines, others stronger growth - the national outlook remains steady. 

As Realtor.com explains: 

“For homebuyers and sellers, the shift signals a more balanced market- one where price growth steadies, rate relief offers breathing room, and negotiating power tilts subtly toward buyers.” 

Taken together, these trends point to improved affordability in 2026 - and that’s why experts expect more homes to sell in the year ahead. 

As Zillow Chief Economist Mischa Fisher notes: 

“Buyers are benefiting from more inventory and improved affordability, while sellers are seeing price stability and more consistent demand. Each group should have a bit more breathing room in 2026.” 

Bottom Line 

Affordability isn’t changing overnight, but steady progress is underway. With mortgage rates stabilizing, inventory improving, and price growth moderating, 2026 is shaping up to be a more balanced, predictable housing market than we’ve seen in years. 

If you’d like to understand how these trends apply to your local market or explore the options available to you, your Employee Homeownership Program is here to help. The program offers guidance, substantial savings, education and support to help you make informed decisions when the time is right. 

SupportSquad@AdvantageHomePlus.com | (800) 511-2197 

The information contained and the opinions expressed in this article are not intended to be construed as investment advice. Advantage Home Plus does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. * Real estate commission contributions are available as state laws allow.