FRESNO, Calif. (KFSN) — The online real estate brokerage Redfin predicts 2026 will bring the “Great Housing Reset.”
A slow recovery leading to a normalization of home prices.
“Nationally, we think home sales will improve 3% from last year, which is not a huge difference, but it is a slight improvement,” says Redfin Chief Economist Daryl Fairweather. “In Central California, I would imagine that home sale growth will be similar, maybe even slightly higher, because of its affordability advantage over coastal California.”
Fairweather predicts 30-year fixed mortgage rates will average 6.3% throughout the year. Not much movement.
Still, she says buying power could increase.
“We think wages will increase faster than home prices,” she said. “We’re only forecasting 1% home price growth, and wage growth will likely continue to rise around 2%. You know, that depends on how strong the economy is or how weak the economy is.”
Fairweather predicts many households will continue to go through a reshaping process.
The expected market changes still are not enough for many young homeowners to afford a house on their own.
“But maybe they have parents who are homeowners, or they have friends who are in a similar situation,” Fairweather said. “We think that there’ll be more inter-generational housing and also more people teaming up with roommates in order to buy homes.”
Redfin also expects to see a rise in refinancing applications next year as homeowners look to pay for renovations.
“One thing that was surprising was when we went to calculate how many more people will be refinancing, we found that a 30% increase was highly likely given how many people have rates above 6%,” Fairweather said.
Fairweather says one-fifth of homeowners are paying home mortgage rates above 6%.
Redfin also predicts AI will play a greater role in helping people find their next house, helping them identify cities and neighborhoods, instead of using a geographical search.
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