What 2026 could bring
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For 2026, expect lower mortgage rates but a still-tough housing market.
Why it matters: Homes remain unaffordable for many, especially younger people.
Here's what industry economists predict.
Rates will stay above 6%
U.S. mortgage rates are expected to hover near 6.3% in 2026, according to Realtor.com chief economist Danielle Hale.
- Redfin also projects 30-year fixed rates will average 6.3%, dipping from 6.6% in 2025 while staying well above pandemic-era levels.
What we're hearing: "A lot of the challenges that the housing market has been grappling with — the lack of affordability and the 'lock-in effect' on existing homeowners — are still going to be present in 2026, but the grip is kind of loosening," Hale tells Axios.
The big picture: Cheaper monthly payments could lift home sales, even if they won't move the needle for every buyer as economic uncertainty and other costs loom large.
Also offering shoppers some relief: Wages are expected to grow faster than home prices, which will rise another 1% in 2026, per Redfin's forecast.
- The median price of a home sold in the U.S. in the second quarter was $410,800, federal data shows, up 27% from the same time in 2019, before the housing market went haywire.
Zoom in: The average selling price for a single-family home in Benton County during the first half of 2025 was $471,427, up 8.8% from a year earlier, per the most recent Arvest Skyline Report.
- It was $417,489 in Washington County, up 7.2% from a year earlier.
More roommates, fewer babies
High housing costs may be reshaping U.S. households.
- Think: More adult children living with their parents (and vice versa), smaller families and more friends buying homes together, "often with prenup-style agreements," according to Redfin researchers.
Between the lines: "Entry-level inventory remains tight, limiting options for first-time buyers," says Selma Hepp, chief economist at Cotality, an industry data provider.
The bottom line: Prices will likely increase 3% to 4% in the Northeast and Midwest this year, "supported by tight inventory and strong labor markets," Hepp tells Axios.