What’s Changing in Real Estate? A Look Ahead to 2026

After years of elevated mortgage rates and buyer hesitation, fresh momentum is finally forming under the surface of the housing market. More sellers are stepping back in. More buyers are returning to the hunt. And for the first time in quite a while, the market is showing real signs of movement.

It’s not a boom — but it is a meaningful shift. One that could pave the way for a stronger housing landscape as we head into 2026.

So what’s fueling this renewed activity? Here are three key trends helping bring new life to the market right now.

1. Mortgage Rates Have Been Coming Down

Mortgage rates naturally fluctuate — that’s simply how the market works. With today’s broader economic uncertainty, some ups and downs are completely normal. But when you take a step back, the bigger picture tells the real story.

And that picture shows rates have generally been moving lower throughout this year (see graph below):

Over the past few months, we’ve experienced the most favorable mortgage rates of 2025. Sam Khater, Chief Economist at Freddie Mac, explains:

“On a median-priced home, this could allow a homebuyer to save thousands annually compared to earlier this year, showing that affordability is slowly improving.”

Why does that matter? Because when rates ease, your buying power increases. Lower borrowing costs can open up more options than you may have had before.

In fact, Redfin reports that a buyer with a $3,000 monthly budget can now afford about $25,000 more home than they could just a year ago. That’s a meaningful shift — and part of the reason we’re seeing buyers come back into the market.

2. More Homeowners Are Ready To Sell

For quite some time, many homeowners chose to stay put rather than give up the ultra-low mortgage rate they already had — a dynamic often called the “lock-in effect.” That kept the number of homes for sale limited. And while many people are still holding onto those low rates today, that grip is loosening as rates improve. More homeowners are moving because of life events — growing families, job changes, downsizing — and that’s helping supply to grow.

According to Realtor.com, the number of homes on the market has risen significantly. In fact, inventory is now approaching levels we haven’t seen in nearly six years (see the blue section in the graph below):

Seeing inventory move back toward more typical levels is a major positive. Buyers finally have more choices than they’ve had in a long time — and that increased selection is helping the market find better balance again.

3. More Buyers Are Entering The Market

It’s not only sellers who are becoming active again. With more choices and improved affordability, buyers are stepping back into the market too. According to the Mortgage Bankers Association (MBA), purchase applications are higher than they were a year ago — a strong indication that demand is resurging (see graph below):

Industry experts expect this momentum to keep building. Forecasters at Fannie Mae, the Mortgage Bankers Association (MBA), and the National Association of Realtors (NAR) all project gradual growth in home sales as we head into 2026.

This turnaround won’t be instant. It’s not a sudden surge — but it is a steady climb. And for many, it’s the progress they’ve been hoping to see.

Bottom Line

After a few slower years, the housing market is finally showing real signs of a turnaround. Lower rates, increased inventory, and more active buyers all signal that momentum is building again.

If you’re thinking about making a move — whether buying or selling — now is the time to start planning. Reach out to me, and I’ll help you understand what these changes mean for your goals and how to make the most of the opportunities ahead in 2026.

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.