What to Expect in the 2026 Housing Market: Key Trends & Forecasts

As we look ahead to 2026, the housing market may be poised for a meaningful rebound — but not without its own set of opportunities and challenges. Below are several major trends that experts are predicting for next year, and what they could mean for homebuyers and sellers in Southwest Michigan, including Kalamazoo, Portage and Mattawan.

1. Sales Volume Is Expected to Jump

The National Association of REALTORS® (NAR) forecasts a 14% increase in existing-home sales in 2026, driven by improving affordability, job growth, and a more stable market environment.

• For our area, this could mean more buyer activity as more people feel confident returning to the market.

• Sellers may benefit from this increase in demand — especially if their homes are well-priced and ready to show.

2. Mortgage Rates Could Ease, But Not Dramatically

• Experts, including NAR and Fannie Mae, are projecting mortgage rates to moderate to around 6.0% in 2026.

• According to Fannie Mae’s more recent outlook, rates could even dip slightly below 6% by late 2026.

• What this means locally: Lower rates could bring more buyers off the sidelines — especially first-time buyers — which may boost demand in Kalamazoo and surrounding areas.

3. Home Price Growth: Steady, Not Explosive

• The NAR projects home prices to rise by about 4% nationally in 2026.

• Other analysts suggest more modest growth (in the 2–4% range), signaling a balanced market rather than a boom or crash.

• For sellers in Southwest Michigan, this may be a good window to consider listing — prices are expected to appreciate, but not skyrocket out of reach.

4. Inventory Could Loosen Slowly

• While supply has been tight, experts expect gradual improvements in inventory, especially as more homes come back on the market.

• That said, persistent supply shortages are still likely in many regions, which supports the price appreciation forecasts.

5. Stronger Demand for Entry-Level and First-Time Buyer Homes

• With more buyers projected to return, demand could be especially strong for starter homes or affordable housing.

• Local builders may respond by increasing the construction of smaller homes, condos, or townhomes — helping meet the needs of younger or first-time buyers.

6. Cautious Optimism — But Risks Remain

• Affordability will still be challenged: mortgage payments are expected to remain relatively high compared to historical norms.

• Inventory improvement is expected to be gradual, not a sudden flood.

• Local market dynamics (like job growth or new construction in Kalamazoo or Portage) will play a large role in how these national trends play out regionally.

✅ What This Means for You (As a Buyer or Seller)

• Buyers: 2026 could be a smart year to buy, especially if you’ve been waiting for rates to soften. But be ready — don’t expect rock-bottom rates, and work with a local agent to find the homes that make sense for your budget and timeline.

• Sellers: With stronger demand likely, well-priced homes could attract more buyers. Just make sure your home is ready to go — consider updates, pricing strategy, and staging.

• Investors: This could be a favorable market for long-term investments as demand increases and prices climb steadily.

🧭 How the Keefer Fischer Real Estate Team Can Help

At the Keefer Fischer Team, led by Kerry Keefer Fischer, we stay on top of market predictions and local forces to help you make the best decisions whether you're buying, selling, or investing in Southwest Michigan. We can help you:

• Forecast how 2026 trends may impact your neighborhood

• Strategize when to list or buy

• Position your home to take advantage of expected demand

📞 Thinking about your next move for 2026? Contact us today for a free consultation and personalized home strategy — let’s make the coming market work for you.