NAR economists project lower rates, rising inventory and a 14% sales increase in 2026, though progress will vary by market as affordability and supply differ locally.
CHICAGO – Top economists have one word to sum up the housing market for 2026: opportunity. Lower mortgage rates and a rising supply of homes are expected to open up the housing market in the new year—something the real estate industry and potential home buyers and sellers have been waiting for, following three years of stagnation.
The National Association of Realtors® is forecasting a double-digit—14% increase—in existing home sales for 2026.
“In 2026, we expect higher inventory, modest improvements in affordability and more accommodating monetary policy from the Federal Reserve will help more Americans buy their next home,” said Lawrence Yun, NAR’s chief economist, during the virtual “Real Estate Forecast Summit: The Year Ahead” on Tuesday.
If mortgage rates drop to 6% — as NAR projects for 2026 — it would mark a full percentage point drop from the roughly 7% average at the start of 2025. That shift could unlock an estimated 5.5 million additional qualified home buyers nationwide, including about 1.6 million renters, who could finally make the leap into homeownership.
“Lower mortgage rates will save the day” for the housing market next year, Yun said. They’ll help improve affordability, but meaningful progress will also depend on increased housing inventory to create more opportunities for buyers and sellers in 2026, he said.
By Melissa Dittmann Tracey. © 2025 National Association of Realtors® (NAR)
