Every year, I like to pause and reflect on the trends shaping our housing market and share my perspective for the year ahead. Whether you’re thinking about buying, selling, or simply keeping a pulse on the market, here are the top 6 trends to watch in 2026.
1. A Market That’s Predictably Unpredictable
The housing market hasn’t followed the rules since COVID. Historically, the market cycled in predictable yearly patterns, with busy seasons and slower periods. Today, economic and political factors weigh more heavily, making fluctuations less predictable.
The key to navigating this unpredictability? Clarify your real estate goals early and stay in touch with a trusted lender and real estate professional. While national headlines report trends 3–6 months behind local markets, staying informed will allow you to take advantage of unexpected upticks in demand and changes in interest rates – or plan for quieter moments.
2. A Change at the Fed Will Cause Market Disruption
The Federal Reserve is expected to appoint a new head in May 2026. While the actual policies may not shift dramatically, market perception alone can create disruption. Similar to the 2024 election, many buyers and sellers may pause their decisions, waiting to see the impact of the leadership change.
Even without immediate effects, uncertainty can influence timing and activity, so staying informed and flexible will be essential.
3. Homeowners Will Continue to Stay Put
Interest rates have softened this year, averaging around 6.3%, a significant drop from last year’s peak of 7%. That’s good news for first-time buyers.
However, many current homeowners enjoy sub-4% mortgages. The incentive to sell and give up a low-rate loan is minimal, so the market will continue to see homeowners holding steady. Expect the main movers to be first-time buyers with tighter budgets and older buyers looking to downsize. While interest rates are expected not to dip much lower in 2026, remember to predict the unpredictable.
4. Prices Will Likely Plateau
Despite media headlines, most homes haven’t experienced dramatic price gains over the past few years. Looking ahead to 2026, home prices are expected to remain relatively stable.
While some predict a sharp decline, the reality is that both Wall Street investors and everyday buyers are ready to step in if prices dip too far, creating a natural floor. Stability, rather than rapid growth or collapse, seems to be the consensus going into 2026.
5. Inventory Will Rise — Buyers Will Have the Advantage
2025 saw 15–25% growth in inventory, with more homes coming on the market each day. This trend will continue in 2026.
Homes in desirable areas and in good condition will still sell quickly. Other properties will need competitive pricing and careful preparation — repairs, updates, and cosmetic improvements will be key to attracting buyers shopping in a 6% mortgage environment.
6. Home Improvement and Design Trends Remain in Demand
As many homeowners choose to stay put in their low-interest homes, they are investing in upgrades that meet evolving family needs. In 2026, kitchen and bathroom renovations, additions, and flexible spaces will continue to be popular.
Design trends to watch include:
- Rich, layered hues that add warmth and personality
- Circular and flowing design elements for harmony and movement
- Defined yet flexible spaces suitable for multigenerational living
- Natural textures and materials to bring the outdoors in
Home improvement and thoughtful design will remain a major focus, allowing families to make their current home work beautifully for years to come.
Bottom Line:
2026 is shaping up to be a year of stability, careful planning, and opportunity. Homeowners who stay put will continue to invest in their spaces, buyers will benefit from rising inventory, and those who stay informed and strategic will navigate the market successfully.
Want to read what the “experts” think? Check out more 2026 predictions below:
- Real Estate Experts Say the Market Will Change DRASTICALLY in 2026
- Economists expect ‘a reset’ for housing in 2026, ‘not a rebound’
- Realtor.com 2026 Housing Forecast
- Housing Market Set for a 2026 Comeback, NAR Predicts
- Redfin’s 2026 Predictions: Welcome to The Great Housing Reset
- Zillow’s 2026 Housing Market Predictions
- AD Pro’s 2026 Interior Design Forecast
- 8 Design Trends Designers Think Are Finally Back in 2026
- Fed faces turbulent 2026 as Powell’s term ends, independence tested
Check out Laura Garcia’s previous predictions and how they have stacked up:
- Laura Garcia’s Five Real Estate Predictions for 2025
- 2022 Real Estate Market Predictions: It is Anybody’s Guess
- What to Expect in 2021? Real Estate & Mortgage Predictions
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