Energy Uncertainty: 4 Scenarios That Could Change the 2026 Housing Outlook

Last year, the start of peak season meant more money for the typical seller. 

Based on 2025 seller data, Zillow’s econ team calculated that April will be the best time to list in some of the nation’s largest metros like Los Angeles, Dallas, and Washington, DC. For example, the typical home listed in Los Angeles during that time sold for an extra $25,300.

This year, however, the spring market is off to a more uncertain start. Buying power was increasing, but the shock of higher oil prices erased some affordability gains as mortgage rates jumped back above 6%. As a result, Zillow’s econ team recalculated the 2026 housing forecast based on a few different possibilities. 

Here are four scenarios that can help you plan ahead for the rest of 2026.

What's the impact on the housing market?

Zillow originally predicted existing home sales would increase 4.4% in 2026 compared to last year. 

As Zillow Chief Economist Mischa Fisher recently explained, “Given this new uncertainty, it is useful to shift one’s view of the potential 2026 outcomes from a singular forecast to a set of possible scenarios.”

Based on when the market shock of higher rates and unemployment may subside, the econ team outlined four scenarios for the rest of 2026.

The good news is that existing home sales are still expected to increase as long as mortgage rates don’t rise further and the 50 basis points shock ends by Sept 1. If the shock ends by May, the market could still see an increase of over 100,000 home sales from the year before.

The only scenario where home sales would fall year over year is if the shock lasts into 2027.

What's the impact on your business?

Based on the uncertainty, buyers and sellers may be hesitant to make a move right now. “No one knows precisely when elevated energy prices will subside,” Fisher said. “The futures market for oil can offer some clues about investor expectations, but nothing is certain.”

For buyers: If your sphere waited last year, hoping 2026 would be a reset year, there’s still reason for them to be optimistic. 

At the beginning of March, buying power was up $30,000 compared to the same time last year. While energy uncertainty wiped out some of that over the last few weeks, buying power is still up around $20,000. 

For sellers: New listings priced and marketed well should still see healthy demand, especially in peak season. Consider sharing the best time to list research as a reference point. The industry refers to peak season as one big block of time, but each metro has its own unique calendar when sellers can hit the market to benefit from the most competition.