7 Tips Based on Zillow’s 2026 Housing Market Predictions

Quick takeaways

• Home values are forecast to rise 1.2% in 2026, after a flat 2025.
• The number of major markets with annual price declines is expected to fall from 24 today to 12 next year.
• Existing home sales are projected to reach 4.26 million in 2026 — a 4.3% increase over 2025.
• Rent affordability should improve, with multifamily rents up just 0.3%.
• The market is expected to look healthier: buyers get a bit more breathing room, and sellers benefit from more stable prices and steadier demand.

2026 is shaping up as a stable year for housing: modest price growth, fewer markets with declines, slowly improving affordability and a bit more breathing room for buyers, all while most sellers keep building equity and see steadier, more predictable demand. Here are seven tips, based on our economists’ predictions, for how to approach the year.

Try positioning 2026 as a low-drama price year

U.S. home values are forecast to grow 1.2% in 2026, after being roughly flat in 2025. That modest growth reflects expectations of gradually improving affordability and steady buyer demand.

Mortgage costs are expected to ease a bit in 2026, which should:

• Help more buyers stay in the market instead of dropping out.
• Support slow, steady price growth in many parts of the country.

Takeaway: “Buyers can shop without panic,” says Zillow Senior Economist Kara Ng. “2026 will be a window for buyers who want stability, not a bidding war circus. Sellers can list knowing prices are more likely to inch up than roll over.”

Consider making “cost-to-live” part of your pitch

Rising everyday costs are pushing buyers and renters to seek homes that stretch their budgets further.

Features gaining traction include:

• Energy efficiency: better insulation, efficient HVAC, solar, whole-home batteries, EV charging.
• “Grocery-optimized” homes: walk‑in pantries, extra cold storage in garages, refrigerated drawers, and smart organization systems that help cut food waste.

These features don’t just feel modern — they help households manage rising utility, grocery and transportation costs.

Takeaway: Consider calling out energy and storage features in listing descriptions, tours, and social posts to stand out with cost‑conscious clients.

Try leading with equity and stability in seller conversations

As home values rise in most major markets, the share of owners at risk of being underwater should shrink. That’s a change from 2025, when values fell in 24 of the 50 largest markets and more than half of homes saw at least some value decline on paper. Zillow expects that number to drop to just 12 major markets with annual price declines in 2026. Stabilizing prices mean:

• More homeowners keep building equity.
• Fewer sellers have to worry about pricing below their last sale price.

Takeaway: Talking points can be framed like this: “2026 is set up to protect the gains you’ve built — and in many markets, to add a modest amount of equity.”

Buyers (and sellers) should plan for rates at or above 6%

Forecasting mortgage rates a year ahead is tricky, but inflation is key. Housing-related costs make up about 40% of the Consumer Price Index, and Zillow’s shelter forecast calls for slower — but still positive — housing inflation into 2026.

Given that backdrop, mortgage rates are unlikely to fall below 6% in 2026. Buyers have already seen some relief compared to peak levels in 2023–2024, and recent rate dips have:

• Improved affordability to a three-year high in late 2025.
• Sparked more listings and more accepted offers than a typical fall market.

Even if pandemic-era ultralow rates remain out of reach, gradual moderation should bring more buyers back into the market.

Takeaway: Try coaching buyers not to wait for lower rates. Frame your value: You’re an expert in your locale. And you help them optimize payments with timing, home choice, and negotiation — 53% of buyers rank negotiation in the top three most valuable agent services.

Expect a bump — but not a boom — in sales volume

Zillow’s forecast calls for 4.26 million existing home sales in 2026, a 4.3% increase over 2025.

Behind that gain:

• Years of limited inventory and high rates have built up “I need to move” demand.
• As affordability improves, more of that pent-up demand should finally show up as actual transactions.
• Recent data already shows what’s possible when rates ease: new listings and pending sales rose 5% year over year in October, bucking typical seasonal slowdowns.

Takeaway: While it’s always a best practice, this year it’ll be especially important to stay in front of your pipeline. Try nurturing “someday” buyers and would-be sellers now so you’re their first call when they act. Consider rescoring leads every 60-90 days based on engagement to see if they’re closer to transacting.

New-construction buyers can shop incentives along with price

2026 is shaping up to be the slowest year for single-family starts since 2019, following a weak 2025. Builders are pulling back because:

• There’s a large stock of new homes already built or underway.
• They’re focused on selling current inventory rather than starting new projects.
• Single-family starts are already trending about 5% below last year’s pace.

Builders are likely to keep leaning on incentives like rate buydowns and closing cost help to move the homes they do have.

Takeaway: Try coaching new construction buyers to shop incentives, not just price. For resale sellers, use this story to show how builder concessions affect local comps and buyer expectations.

For shoppers who rent, try focusing on the long-term

The lifestyle renter will emerge as a bigger force in the coming year. A growing share of renters are renting by choice, not just because they’re priced out.

• Many are drawn to renting for mobility and fewer surprise costs, especially as the “hidden” costs of owning (maintenance, insurance, taxes) now average nearly $16,000 per year nationally.
• Nearly 3 in 5 renters say they plan to keep renting next year, and even if mortgage rates fell, only about 37% say they would buy — down from 45% a year earlier.

These “lifestyle renters” care less about a fast path to owning and more about flexibility, predictable costs, and amenities that fit how they live.

Takeaway: With lifestyle renters, try connecting the dots: “If you’ll stay put for a while, owning can turn your biggest expense from a yearly question mark into a long‑term plan.”

Note: The content in this article is for informational purposes only and intended to contain best practices - results will vary; you are not required to use them in order to use any of Zillow’s products and nothing in this guide is intended to be legal or professional advice. You are responsible for ensuring your own compliance with applicable laws. For specific questions about any duties or obligations arising out of a real estate transaction, check your local and state licensing laws and regulations.