Real Estate Rookie Redfin: The Great Housing Market “Reset” Starts in 2026
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Dec 24, 2025 In this discussion, Chen Zhao, head of economic research at Redfin, shares insights on the impending housing market reset slated for 2026. She unveils 11 predictions, highlighting improving affordability and modest price growth fueled by rising wages. Chen explores mortgage rates likely stabilizing in the low sixes and the potential for rental demand to pick up. With AI poised to revolutionize property searches and climate risks influencing decisions, her analysis offers a glimpse into a changing real estate landscape.
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Plan For A Gradual Affordability Recovery
- Expect affordability improvements mainly because wages will outpace slow price growth, not because prices plunge.
- Plan for a multi-year transition — meaningful affordability gains may take five to six years.
Sales To Tick Up Modestly
- Existing-home sales should inch up slightly from historically low levels, rising maybe around 3%.
- The buyer-seller stalemate limits any big rebound in transaction volume next year.
Rents May Reaccelerate Slightly
- Rents have been flat or falling, but 2026 should see rents tick up slightly as multifamily construction slows.
- Continued affordability challenges will keep some demand in the rental market, supporting rent growth.