The 2026 housing market is already taking shape, and the big question I’m hearing from buyers and homeowners in San Diego is this:

“Is next year finally going to make it easier to move?”

The newest national forecasts from NAR, Realtor.com, and Zillow all agree on one thing:
We’re not heading for a dramatic reset…but we are moving toward a healthier, more balanced market.

Here’s what the experts are predicting, and what it could mean for your plans in 2026.

Sales Activity: Slow Improvement, Not a Frenzy

All the major forecasts show more home sales in 2026 as affordability very slowly improves. The projections vary, but the trend is the same: movement is coming back.

Here’s what the national experts expect:

• NAR: A 14% increase in home sales

• Zillow: A 4.3% increase, reaching roughly 4.26M sales as pent-up demand finally starts to unlock

• Realtor.com: A more modest 1.7% increase to around 4.13M sales

Realtor.com is the most cautious because 80% of homeowners still have mortgage rates under 6%, so many may stay put a little longer.

In San Diego the speed of change will depend on how quickly new listings go under contract. That’s one of the best signals of shifting demand, and it’s something I watch closely every week.

Home Prices: Still Rising, But With More Breathing Room

The days of runaway price growth are likely behind us, but prices are still projected to climb. If you’re waiting for a big drop, that strategy isn’t likely to pay off.

Here’s what the national data shows:

• Prices rising between 1.2% (Zillow) and 4% (NAR)

• More markets stabilizing

• Fewer major metros expected to see price declines (from 24 → 12, per Zillow)

For homeowners in our market, that means continued equity growth.
For buyers, it means negotiating room, which is exactly what I've been able to do for all my buyers this year.

Mortgage Rates: Better Than 2025, But We’re Not Going Back to 3%

All three forecasts expect mortgage rates to hang out above 6% next year, but comfortably below the early-2025 highs.

Here’s the national outlook:

• Realtor.com: ~6.3% average in 2026

• NAR & Zillow: steady improvement, but not a return to pandemic-era rates

• Zillow expects more buyers to re-enter the market as payments become more manageable

And yes, every forecast includes the same disclaimer:
Barring any major world-changing events (because we all learned our lesson in 2020).

If you’re hoping to buy here in San Diego getting pre-approved early, and talking with your trusted Realtor, will help you understand exactly what’s possible with your budget.

Inventory: More Homes to Choose From, But Still Below Normal

Inventory is slowly rebuilding after years of record lows, this is one of the biggest shifts we’ll feel in 2026.

National experts predict:

• 8.9% increase in existing home inventory

• 4.6 months of supply, moving us closer to true balance

• Builders using incentives and rate buy-downs to keep new homes moving

In our market more inventory will absolutely help buyers, but great homes will still attract strong interest. Offers still need to stand out.

Affordability: Finally Trending in the Right Direction

The good news:
2026 is expected to be the first year in a while where affordability improves, even if slowly.

National indicators show:

• The share of income needed for a mortgage dropping to 29.3%, the first dip below 30% since 2022

• More first-time buyers able to qualify

• Rent affordability improving, helping renters save faster for down payments

If you’re renting in San Diego, this may be your window to start preparing for ownership.

What It Means If You Want to Buy in 2026

Little improvements add up. Buyers may see:

• Slightly lower monthly payments

• More properties to choose from

• Less intense bidding pressure than the past few years

The smartest move is to get your budget, strategy, and timeline clear early so you can move confidently when the right home hits the market. Having a strong plan in place is always going to be my recommendation.

What It Means If You Want to Sell in 2026

Sellers are still in a strong position. Prices are rising, equity is high, and demand remains solid.

Sellers in this market benefit from:

• Strong resale values

• A growing pool of qualified buyers

• Excellent equity to roll into your next chapter

But, and this is important, pricing strategy matters more now as buyers become more payment-sensitive.

Bottom Line

National forecasts point to 2026 being a more balanced, more manageable, and more optimistic year for real estate.

And when it comes to buying or selling in San Diego, planning early will help you take advantage of improving affordability and increasing inventory.

If you’re thinking about making a move in 2026, reach out anytime. These strategy sessions are what we love, and I'd be happy to help you map out your smartest path forward:https://links.townsites.com/widget/bookings/intro-call-with-shelly