As the U.S. housing market enters 2026, private home markets are steering through a complex landscape characterized by subdued price appreciation, persistently elevated mortgage rates, and gradually improving inventory conditions.
Forecasts for median home price growth range from approximately 1% to 4% year-over-year, with Zillow projecting 1.2% national home value growth, Realtor.com anticipating 2.2% appreciation, and the National Association of REALTORS® offering a more optimistic 4% gain supported by employment expansion and constrained supply. The divergence in projections reflects differing assumptions about demand resilience and inventory dynamics, though most analysts agree that nominal price increases will remain modest relative to pre-pandemic norms.
Mortgage financing costs continue to shape buyer behavior, with the average 30-year fixed rate projected to settle around 6.3% according to Realtor.com’s baseline forecast, while Redfin anticipates rates in the low-6% range.
These levels represent a moderate decline from mid-6% figures observed in 2025, yet remain sufficiently elevated to constrain purchasing power for many households, particularly first-time buyers among Gen Z and young families. Realtor.com projects typical monthly payments at approximately 29.3% of median income, dipping below the 30% threshold for the first time since 2022.
This suggests marginal affordability improvements rather than a fundamental reset in housing accessibility. In contrast, some private residential markets anticipate that stable borrowing costs will support total sales volumes surpassing the past 10-year average.
Inventory conditions show gradual normalization, with active for-sale listings projected to rise 8.9% in 2026, marking a third consecutive annual increase while still remaining roughly 12% below pre-2020 benchmarks by year-end. This improved supply combined with slightly lower purchase costs is expected to create better deals for buyers navigating the market.
The unwinding of lock-in effects from ultra-low pandemic-era rates is expected to release pent-up listing supply among existing homeowners. Real estate professionals must maintain robust customer due diligence protocols to prevent illicit funds from entering property transactions as regulatory scrutiny intensifies.
New single-family home supply is forecast to grow approximately 3.1%, though Zillow expects housing starts to fall about 2% below already weak 2025 levels, indicating persistent construction constraints.
Transaction volumes reflect cautious optimism, with NAR forecasting a 14% nationwide increase in home sales, while Zillow projects 4.26 million existing-home sales representing a 4.3% gain.
Realtor.com anticipates 4.13 million transactions for a 1.7% year-over-year rise.
New-home sales are projected to increase approximately 5%, sustaining builder engagement despite ongoing cost pressures.
