Answer extracted from the Real Estate Intelligence Daily — PropTech, Finance & Commercial Market Insights podcast — listen to the full episode below.
What does the National Association of Realtors' chief economist forecast for home sales in 2026?
The National Association of Realtors' chief economist projects a 14% jump in home sales in 2026 after flat growth in 2025, supported by steady employment and declining mortgage rates. The 30-year fixed rate has eased from roughly 7% earlier in the year to the mid-6% range, providing modest relief to buyers' purchasing power.
This forecast hinges on two critical factors working in tandem. First, employment remains stable despite earlier economic headwinds, which means buyers still have confidence in their ability to qualify for mortgages and commit to purchases. Second, the gradual decline in mortgage rates addresses one of the market's most pressing constraints—affordability. As discussed in the episode, even modest rate reductions from 7% to the mid-6% range can meaningfully shift buyer behavior and unlock pent-up demand.
The 14% projection represents a significant swing from the stagnation forecasters expected just months earlier. However, this optimism must be weighed against a counterforce: the historic inventory squeeze strangling the market. The data from this podcast reveals that nearly 5.8% of home listings were pulled off the market in April—the fastest pace since March 2020—as sellers cling to their ultra-low pandemic-era mortgage rates and refuse to trade them for today's higher rates.
Why sellers are staying put despite forecasted demand
The paradox at the heart of this forecast is that even as affordability improves and buyers emerge from the sidelines, sellers remain locked in place by mortgage rate psychology. Many current owners hold 30-year mortgages at 3% or 4%, a rate advantage so significant that the prospect of selling and refinancing above 6% becomes economically irrational.
This dynamic creates what market observers call a stalemate. Buyers have more negotiating power than in the 2021–2022 boom, yet they face severe scarcity of available homes. The result: even if the NAR forecast proves accurate and transactions do spike 14%, the inventory deficit will likely mean that price competition remains fierce and frustration among buyers persists. The episode explores how this inventory lockdown may ultimately cap the scale of any sales recovery, despite improved affordability signals.
For a deeper analysis of how institutional capital is repositioning amid these market dynamics, listen to the full episode for insights into which market segments are attracting investor attention and where the real opportunities lie.
Key takeaways
- The NAR chief economist forecasts a 14% jump in home sales in 2026, a dramatic recovery from flat 2025 performance.
- Steady employment and mortgage rates declining to the mid-6% range from ~7% are the primary drivers of improved buyer demand.
- A historic inventory shortage—with 5.8% of listings pulled in April 2026, the fastest pace since March 2020—may constrain the full realization of this forecast.
- Sellers locked into 3–4% mortgages remain reluctant to trade those rates for loans above 6%, perpetuating the supply-demand mismatch.
See also
What major loss did Blackstone experience on a Seattle office building sale?
Private equity giant Blackstone agreed to sell Seattle's iconic U.S. Bank Center tower for roughly $280 million, representing a staggering 54% loss on its original investment.
What is driving institutional investors' renewed interest in retail real estate?
Over $15 billion of retail real estate changed hands in the first quarter of 2026, a 5% increase from a year ago, driven by improved fundamentals and solid tenant performance.
How have first-time homebuyers been impacted by current market conditions?
The share of first-time buyers has plunged to a record low, with just about one-fifth of home purchases made by first-timers, far below the historical norm of around 40%.