Zillow’s latest forecast projects home values to increase 0.7% annually at year’s end, alongside a 4.4% increase in existing home sales in 2026 compared to the previous year.

Zillow’s projected 0.7% increase in home values represents a slight downward revision from last month’s forecast. As the housing market moves toward balance, new listings and sales are expected to increase at roughly the same pace. That closer alignment between supply and demand should help keep home values relatively stable overall.

Existing home sales are now projected to reach 4.24 million in 2026, a small upward revision from last month’s estimate of 4.2 million. Moderately easing mortgage rates are expected to unlock some pent-up demand, supporting a modest rebound in transactions. Even with this improvement, sales are expected to remain below historical norms.

Zillow projects multifamily rents to rise by 0.9% annually at year’s end, while single-family rents are expected to increase by 1.8% over the same period. Elevated vacancy rates, ongoing multifamily completions and added competition from homes converting from listed for sale to listed for rent continue to weigh on rent growth. Expectations for persistently soft rent gains suggest renters will retain negotiating power.