Buyer Demand Is Heating Up — What Houston Home Sellers Need to Know in Late 2025
The housing market is showing a level of energy we haven’t seen in quite some time, and the data clearly supports it. Mortgage rates have dropped nearly a full percentage point this year, and that change is drawing buyers back into the market.
Home loan applications are climbing, activity is accelerating, and sellers who act sooner rather than later may benefit from this renewed momentum before more competition enters the picture.
Let’s break down what’s driving these changes and how you can position yourself to take advantage of them.
Lower Mortgage Rates Are Encouraging Buyers
In today’s housing market, buyer activity moves almost in lockstep with mortgage rates. When rates decline, interest from buyers rises — and that pattern is playing out once again. As Rick Sharga, Founder and CEO of the CJ Patrick Company, puts it:
“We’re in an incredibly rate-sensitive environment today, and every time mortgage rates dip into the low-to-mid 6% range, we see a surge of buyers reenter the market.”
Current data supports this trend. Many buyers who paused their search earlier are now applying for mortgages as borrowing costs ease. While demand will naturally fluctuate alongside rate changes, the broader takeaway is clear: overall buyer activity has strengthened since rates began trending downward.
According to the Mortgage Bankers Association (MBA), the Mortgage Purchase Index is now hovering near its highest point of the year.
And that’s not the only encouraging signal. The Mortgage Bankers Association (MBA) reports that mortgage applications have recently reached their highest level in nearly three years — a clear indication that buyer demand is gaining momentum as we head into 2026.
And to be clear, this isn’t simply delayed demand from the brief government shutdown that slowed the processing of certain loans. Looking back at the previous data, you can see that buyer activity has been steadily building throughout the year.
The key takeaway is this: as mortgage rates have come down, buyers are gradually re-entering the market — and that renewed interest is translating into real offers on homes like yours.
Home Sales Are Gaining Momentum
To further reinforce that the market is moving in a positive direction, the latest report from the National Association of Realtors (NAR) shows an increase in pending home sales — meaning more homes are going under contract. In fact, the Pending Home Sales Index has reached its highest level of the year (see graph below).
All of this points to the market finishing the year with positive momentum and heading into 2026 with renewed strength. While the shift may feel subtle, it represents a meaningful rebound worth paying attention to.
Pending home sales are one of the best indicators of future market activity. When more homes are going under contract, it typically leads to more closed sales in the following months. That’s one reason industry experts expect home sales to trend slightly higher in 2026 compared to both 2025 and 2024.
There may be some short-term fluctuations as mortgage rates move around toward the end of the year, but those changes aren’t expected to disrupt the broader trend. Forecasts suggest rates will remain relatively stable through 2026, setting the stage for continued momentum in the new year.
What This Means for You
This creates a real opportunity for sellers who act now:
Stronger buyer interest: As affordability improves, more buyers are actively touring homes and scheduling showings — especially when properties are priced correctly and well-prepared. Many of these buyers have been waiting for the right moment and are motivated to move.
A head start on the market: Listing sooner allows you to get ahead of other sellers who haven’t yet recognized the shift in momentum.
If you’ve been hesitant to sell because you weren’t sure buyers were out there — or if you previously took your home off the market due to low activity — this could be your signal that conditions are changing.
Bottom Line
Wondering what buyer activity looks like in your area and how it could impact your plans to sell in the new year?
Let’s talk. Reach out to me to see if listing in early 2026 makes sense for you and how you can take advantage of the market’s growing momentum.
Disclaimer: The information provided in this blog post is based on the latest available data at the time of writing, which is subject to change. It is intended for informational purposes only and should not be considered as financial or investment advice.