Real Estate Rundown March 2026

Photo by Sandra Ivleva via Unsplash

January Home Sales Fall Flat

The U.S. housing market continues to face mounting pressure from high home prices, limited supply, and weakening consumer confidence, prompting National Association of Realtors Chief Economist Lawrence Yun to call it “a new housing crisis.” Existing home sales fell 8.4% in January to an annualized rate of 3.91 million—the slowest pace since late 2023 and the steepest monthly decline in nearly two years—with sales down 4.4% year over year. While affordability has improved slightly due to wage growth outpacing home price gains and mortgage rates easing to around 6.1%, inventory remains tight at just a 3.7-month supply, well below the six-month level considered balanced. The median home price hit a record $396,800 for January, up 0.9% annually, and homes are taking longer to sell. Activity remains strongest in the luxury segment, while lower-priced homes have seen the sharpest sales declines, underscoring a market where many Americans remain sidelined, and mobility is limited.

Home Buying Affordability Improves

Mortgage rates have fallen to 6.01%—their lowest level since September 2022—bringing the median monthly housing payment down to $2,599, a 2.6% decline from a year ago. With wages up nearly 4% year over year, buyers have gained roughly $34,000 in purchasing power compared to when rates hovered near 6.9%, offering a meaningful boost to affordability. Still, market activity remains cautious: pending home sales dropped 5.5% annually in late February, marking the largest decline in over a year, while new listings slipped 2.8%. Rising home prices (up 1% year over year), economic uncertainty, and harsh winter weather have kept many buyers and sellers on the sidelines. However, as spring approaches and rates stabilize, early signs suggest motivated, financially secure buyers are beginning to re-enter the market—particularly for well-updated homes in desirable neighborhoods. 

Buyers Gain Negotiating Power

As home sales remain sluggish this winter, more sellers and builders are turning to price cuts and incentives to attract cautious buyers, creating a market where negotiation is back in play. In February, 36% of homebuilders reported cutting prices—by an average of 6%—while 65% offered incentives like closing cost assistance, mortgage rate buydowns, and design upgrades, with some even advertising rates under 5%. The pressure is spilling into the existing-home market, where nearly 1 in 5 listings have seen price reductions and about 11% have had three or more cuts, particularly in markets like Austin, San Antonio, Tampa, and Denver. While median home prices remain historically high and most homeowners still hold substantial equity gains, rising inventory in certain metros is forcing sellers to “price it right” or risk chasing the market downward. For buyers, improving affordability—driven by wage growth and lower mortgage rates—combined with increased concessions may create a window of opportunity, even as the broader market shows signs of moderation rather than distress.

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