Everyone wants to know what happens next with real estate. You might be tired of hearing about high prices and stubborn interest rates. The good news is that we finally have some fresh data to look at. Redfin’s 2026 Predictions are officially out, and they paint a picture that looks very different from the crazy years we just left behind.
Experts refer this new period as “The Great Housing Reset”. It is not a collapse. It is not a sudden increase in the market. Rather, it is a gradual and quite consistent return to the usual situation. If you have been sitting out, waiting, this could be the year that things become clear again. Your wallet, your home value, and your future moves.
Let’s analyze in detail what Redfin’s 2026 Predictions mean for each of these.
The term “Great Housing Reset” sounds big, and it is. For the last few years, the market has felt stuck. Sellers didn’t want to sell, and buyers couldn’t afford to buy them. Redfin’s 2026 Predictions show that this freeze is finally melting. We are entering a long period where things just work better.
With this reset, affordability will be able to get better slowly. It is not going to be an instant change, but the figures are starting to turn towards the buyer. According to the report, the number of home transactions will slightly increase. Prices will also be closer to their usual level, i.e., they will not go up dramatically. The recovery is going to take several years, and it is starting from this moment.
Here is one of the most hopeful parts of Redfin’s 2026 Predictions. For the first time since the Great Recession ended, people’s incomes are expected to grow faster than home prices. This is huge. In the past, houses got more expensive faster than you could get a raise. That cycle is breaking.
Redfin predicts that the median home price in the U.S. will only go up by about 1% in 2026. That is a tiny increase. At the same time, wages are set to rise more than that. This gap means your paycheck goes further. It gives buyers a chance to catch their breath and save up for that down payment without the goalpost moving away from them.
We all want to see rates drop back to 3%, but Redfin’s 2026 Predictions say we need to be realistic. The forecast shows mortgage rates will likely stay in the low-6% range. The 30-year fixed rate is expected to average around 6.3% for the year.
Why won’t they drop more? The Federal Reserve is expected to cut interest rates a bit as the labor market softens. However, inflation risks are still lurking. This keeps the Fed cautious. So, while we might see rates dip below 6% for short moments, do not bet your savings on it staying there. The low-6% range is the new normal for now.
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With rates of stabilizing and income growing, more people will buy homes. Redfin’s 2026 Predictions estimate that existing home sales will climb by 3% compared to 2025. That brings the total number of sales to about 4.2 million.
This isn’t a flood of sales. It is more like a steady stream. Affordability is improving just enough to bring some buyers back. But many people are still priced out. Also, some folks are worried about their jobs as AI changes the workplace. This uncertainty keeps the sales growth modest. It is steady progress, not a race.
Not every city will feel the reset the same way. Redfin’s 2026 Predictions highlight a big shift in where people want to live. The “Zoom Towns” that exploded during the pandemic, like Austin and Nashville, are cooling off. Why? Because remote work is shifting, and climate risks are making insurance expensive in places like Florida.
So where is everyone going? The report points to the Midwest and the Northeast. Places like the Great Lakes region and suburbs around New York City are heating up. These areas are relatively affordable and safe from major climate disasters. If you own a home in Chicago or Buffalo, 2026 might be a good year for you.
If you rent, you need to pay attention to this part of Redfin’s 2026 Predictions. For a while, there were so many new apartments being built that rent stayed flat or dropped. That building boom is over. Construction has slowed down significantly.
With fewer new apartments coming online and demand rising, rents are expected to increase. The forecast says rents will go up by 2% to 3%. It matches the pace of inflation. If you have been thinking about buying a home to escape rising rents, this might be your motivation to act soon.
High costs have changed how we live. Redfin’s 2026 Predictions suggest we will see fewer “nuclear families” buying homes on their own. Instead, we will see more friends pooling money to buy a house together. We will also see more adult children living with their parents.
Multigenerational living is becoming a top trend. Renovations to add “in-law suites” or separate living areas are going to be very popular. It is a practical solution to the affordability of puzzles. People are getting creative to make homeownership work.
Even though rates aren’t crashing, they are lower than the peaks of 2024 and 2025. Redfin’s 2026 Predictions expect a 30% jump in refinancing volume. Many people bought homes when rates were over 7% or even 8%.
For these homeowners, dropping to 6.3% saves real money. It is not a huge drop, but it is enough to lower a monthly payment by hundreds of dollars. If you bought recently, keep a close eye on daily rates. You might be able to save some cash sooner than you think.
For personalized guidance on buying or selling during this reset, trust the team at REDHEAD HOME PROPERTIES.
Redfin’s 2026 Predictions first and foremost point to stability. After the tumultuous years, things are calming down. A period is coming when salaries will be aligned with the cost of living, prices will be stable, and buyers will have a bit more leverage. The situation won’t be very comfortable for all people, but at least it is moving in the right direction. The Great Housing Reset has arrived, and it is opening new possibilities for both buyers and sellers.
It depends on your budget. Affordability is improving because wages are growing faster than home prices. If you can afford the 6% mortgage rates, it is a stable time to buy without fierce bidding wars.
Expect rates to hover in the low-6% range. Redfin forecasts that the 30-year fixed rate will average 6.3% throughout the year.
Look to the Midwest and the Northeast. Cities in the Great Lakes region and NYC suburbs are predicted to be the hottest markets due to affordability and climate safety.
Likely not. Rents are predicted to rise by 2% to 3% as the supply of new apartments slows down, and demand keeps growing.
