After years of high rates and stalled activity, the housing market is finally showing signs of life. Sellers are returning. Buyers are stepping back in. And while it’s not a sudden surge, the shift is real — and it’s setting the stage for a stronger 2026.
Here are the three forces driving the comeback.
1. Mortgage Rates Have Been Coming Down
Rates will always rise and fall, but the overall trend this year has been downward, and that’s what matters.
With recent months bringing the best mortgage rates of 2025, affordability is quietly improving. Freddie Mac’s Chief Economist Sam Khater explains that today’s lower rates allow buyers to save thousands annually, increasing their buying power in a meaningful way.
In fact, Redfin data shows a buyer with a $3,000 monthly budget can now afford about $25,000 more home than a year ago. That’s a major shift — and a big reason activity is picking up.
2. More Homeowners Are Ready To Sell
For years, homeowners stayed put to protect their ultra-low rates, limiting inventory across the country. But with mortgage rates easing and life events taking priority again, more sellers are stepping forward.
Realtor.com reports that inventory is rising — and approaching levels we haven’t seen in six years.
This return to a more balanced, healthier market gives buyers something they’ve desperately needed: options.
3. More Buyers Are Re-Entering the Market
As inventory grows and affordability improves, buyers are re-engaging. The Mortgage Bankers Association shows purchase applications are up compared to last year — a clear sign that demand is rebuilding.
Even better, economists from Fannie Mae, MBA, and NAR all forecast moderate sales growth heading into 2026.
This isn’t a fast turnaround. It’s a steady recovery — but the direction is finally upward.
Bottom Line
The housing market is turning a corner. With easing rates, rising inventory, and returning buyer demand, 2026 is shaping up to be a stronger, more balanced year.
✨ Want to position yourself ahead of the shift?
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