After two years of stagnation, the U.S. existing home sales market is poised for a significant rebound in 2026. The consensus among leading economists and real estate organizations points to a substantial increase, driven by a combination of more favorable mortgage rates, a gradual improvement in inventory, and the release of pent-up buyer demand.
The Driving Force: Mortgage Rates
The primary catalyst for the anticipated rise in sales is the expected moderation of mortgage rates. Throughout 2024 and 2025, elevated rates have been the single greatest impediment to the housing market. They have not only priced many potential buyers out of the market but have also created a “lock-in effect,” preventing homeowners with historically low rates from selling their homes.
Forecasts from institutions like Fannie Mae and the National Association of Realtors (NAR) project a gradual decline in the 30-year fixed mortgage rate. While they are not expected to return to the sub-4% levels of the pandemic era, a consistent drop into the low-to-mid 6% range in 2026 would be enough to stimulate the market. As the cost of borrowing decreases, affordability will slowly improve, giving a green light to a large pool of sidelined buyers.
Inventory and the Release of Pent-up Demand
A rise in sales is directly tied to an increase in available homes. For the past few years, inventory has been at historic lows. While it has ticked up in 2025 as homes take longer to sell, the real increase in listings is expected in 2026 as sellers become more willing to move.
A more balanced and stable mortgage rate environment will make it more financially feasible for homeowners to sell their current property and buy a new one. This will trigger a cycle of increased listings and sales. The market’s immense pent-up demand—from first-time buyers, growing families, and those looking to downsize—is waiting for this moment. As more homes become available and borrowing costs ease, this demand will be unleashed, fueling a significant rise in sales volume.
Forecasted Sales Growth
The forecasts for 2026 are optimistic. NAR’s chief economist, Lawrence Yun, has a particularly bullish outlook, predicting an increase in existing home sales of over 10%. This would represent a dramatic recovery from the multi-decade lows of 2024 and 2025. Other analysts also anticipate double-digit percentage gains.
While the market will still face challenges, such as regional disparities and lingering affordability issues in high-cost areas, the overall trend is clear. After a long period of stagnation, 2026 is shaping up to be the year the housing market finally gets its legs back, with a projected surge in existing home sales that will signal a return to a more active and functional real estate environment.