The first half of 2026 has been a rollercoaster of a housing market, to say the least.
Mortgage rates finally fell under 6%, according to Freddie Mac, then spiked back up once the Iran war started. Sellers have been forced to cut listing prices, and inventory is abysmally low.
I’ve been covering the housing market for years, and even I have to say… I’m exhausted by the instability of mortgage rates so far in 2026. They impact both homebuyers’ wallets and the broader real estate market in so many ways. I know mortgage rates are inherently unpredictable, but I crave some sort of steady movement one way or the other.
Will that volatility end in 2026? That’s the question the information services company HousingWire wants to answer.
The company published its 2026 housing market predictions in late 2025. Now, it’s updating its outlook halfway through the year.
In the HousingWire housing market tracker, the company laid out its expectations for the real estate market for the rest of 2026, including keys to the market’s success.
The magic mortgage rate is 6.64%
The HousingWire report notes that housing market activity typically improves when mortgage rates are under 6.64% and moving downward. If they’re above 6.64% and inching toward 7%, housing data tends to weaken.
Many track weekly mortgage rates through Freddie Mac, but HousingWire tracks and publishes daily mortgage rates itself. As of June 23, the average 30-year fixed mortgage rate was 6.79%.
Related: Mortgage rate news lands Americans in strange situation
In its original housing market forecast, published in December 2025, HousingWire predicted 2026 mortgage rates would fall to between 5.75% and 6.75%. But with unforeseen issues such as the Iran war, 30-year mortgage rates have crept past the 6.75% point.
Although mortgage rates have surpassed 6.64%, they haven’t reached 7% yet. Now that there is a ceasefire between the U.S. and Iran and an end to the war in sight, mortgage rates could decrease.
However, due to other issues such as inflation and the Federal Reserve, even HousingWire couldn’t make a confident prediction on what mortgage rates will do in the second half of 2026.
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HousingWire expects new listings to decrease
The HousingWire report expects new listings to decline in the second half of 2026, but that’s mainly a seasonal trend.
As we get closer to the end of the year, new listings data starts to fade even more, but we always want to keep an eye on how it behaves in the summer,” writes Logan Mohtashami, lead analyst for HousingWire. “By fall and once we are in winter, not so much.”
More on the housing market:
- Bank of America reveals surprising housing market shift
- Zillow exposes hidden threat making homes unaffordable
- Redfin uncovers new problem for homebuyers
Mohtashami points out that overall housing inventory growth has been slower in 2026 than 2025. Inventory rose over the last two weeks, but barely — growth is mainly considered flat.
Inventory could grow more rapidly if mortgage rates tick down, because lower rates encourage sellers to list their homes and move without fears of buying a new house with a higher rate. Mohtashami says he will keep an eye on how inventory responds to any rate changes.
Low housing inventory is the main problem behind the housing affordability crisis. When demand outpaces supply, homes become more expensive, and homebuyers are priced out of the market.
Key takeaways from the HousingWire report
- We want mortgage rates to decrease. This may seem obvious — who wouldn’t want lower mortgage rates? But low rates don’t just reduce monthly mortgage payments. They also help housing market activity overall and have a ripple effect on real estate.
- HousingWire expects mortgage purchase applications to increase. Mohtashami states that mortgage applications should grow in 2026 as long as mortgage rates stay under 7%.
- Home price growth should stay reasonable. “Home-price growth really isn’t going anywhere this year,” Mohtashami writes. This is based on activity in the first half of 2026, and so far, there aren’t major reasons to believe otherwise.
- A lot is still unknown. Conflict in the Middle East is settling down, but the war is not officially over. The Federal Reserve will likely hike the federal funds rate later this year. There are plenty of factors that make the housing market in the second half of 2026 difficult to predict.
Source: HousingWire
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