2026 Is the Messy Transition Year — 2027 Is Where It Gets Good
Let’s be real: 2026 isn’t glamorous. It’s the hangover year. The market is finally sobering up after four straight years of pandemic chaos—frozen movement, whiplash mortgage rates, affordability getting crushed, and supply making zero sense depending on where you live.
But here’s the thing: this is the turning point.
In 2026, the worst of the distortions are finally unwinding. Prices aren’t running wild anymore. Inventory is coming back. Buyers and sellers are resetting expectations after years of scarcity and delusion. It’s not heaven yet—but it’s the setup.
Here’s what the data is telling us:
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Home Prices: Prices basically go nowhere. Flat. Maybe up a hair (+0.5%), maybe down a bit. A lot of metros are already seeing declines, which makes 2026 the most likely year in a long time to see a small national dip. Inventory and affordability keep prices from popping off, but strong household finances keep things from crashing. Boring, stable, necessary.
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Home Sales: This is where things start to move again. Sales momentum is the strongest it’s been since the pandemic, especially at the higher end. Existing home sales should climb about 5% (assuming rates stay around 6%), and if the stars align, we could see a 10% jump. Not amazing—but way better than stuck.
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Inventory: Supply finally shows up. We’re looking at roughly 10% growth, with the Northeast and Midwest catching up while the Sun Belt cools off. This is healthy. It lets deals happen and keeps prices from doing anything stupid.
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Mortgage Rates: Rates are still annoying, bouncing between the high 5s and near 7%, averaging around 6.4%. Jobs and inflation will decide which way they go. No miracles here—just reality.
Bottom line: 2026 is the grind. It’s awkward, uneven, and not particularly fun. But it’s clearing the runway.
2027? That’s when things actually start to feel good again.
- Click Here for the Full Economic Housing Forecast
