DENVER (Diya TV) — Home prices may finally cool in parts of the United States next year, offering a small break to buyers after years of steep increases and tight supply. A new analysis from Realtor.com projects that home values will dip in 22 of the largest 100 U.S. cities in 2026, marking a potential shift toward a more balanced housing market.
The U.S. housing market has remained tough for buyers, with home prices sitting near record highs and mortgage rates holding above 6%. But a shift may be underway. Realtor.com’s outlook shows that 22 major cities could see home prices fall next year as supply grows and demand cools.
Many of the expected price drops will happen in the Southeast and the West. Florida stands out, with seven of its eight largest cities projected to post declines. Miami is the only major Florida city expected to avoid a drop.
The Cape Coral–Fort Lauderdale metro area may see the nation’s biggest decline, with prices forecast to fall by 10.2%. The North Port–Sarasota–Bradenton region follows with a projected 8.9% drop. Both areas saw intense demand during the pandemic, driven by low mortgage rates and remote work trends.
Senior economist Jake Krimmel of Realtor.com said these markets are now returning to more typical patterns. He noted that inventory has expanded in several cities, giving buyers more options and reducing pressure on prices.
Krimmel said the 2026 market may feel more balanced than in recent years. He expects it to be the “most buyer-friendly” market since the early days of the pandemic. Both buyers and sellers may find a more equal footing during negotiations.
Realtor.com also forecasts a slight improvement in mortgage rates. The average mortgage rate could fall to 6.3% in 2026, down from 6.6% in 2025. Lower borrowing costs and steady wage growth could help buyers re-enter the market.
“2026 is going to be a year where we think the market is going to steady,” Krimmel said. “It’s going to show a lot of signs of getting back on track to what we consider to be normal.”
The report predicts existing-home sales will rise to 4.13 million next year, an increase of less than 2% from the projected 4.07 million sales in 2025. Although the bump is small, it signals movement after a sluggish year.
Zillow also expects the housing market to ease in 2026. The company projects nearly 4.3 million existing-home sales next year, up 4.3% from its 2025 outlook. Zillow sees mortgage rates holding slightly above 6%. That is higher than the ultra-low rates seen during the pandemic but closer to long-term historical averages.
Both Zillow and Realtor.com note that growing inventory will play a key role. More homes for sale mean more choices for buyers and more balanced price pressures. Several cities that experienced a buying frenzy during the pandemic now show steadier demand as the market cools.
While 22 cities may see lower prices, the other 78 major U.S. markets are expected to post price increases. Realtor.com’s forecast shows modest growth, with a median rise of 4% across those cities. These markets continue to face steady demand, limited supply, or strong job growth. Realtor.com based its projections on inventory levels, new construction, pricing trends, wage and job growth, and unemployment rates across the 100 largest cities.
The 2026 outlook suggests that the market is moving away from the extreme conditions of the pandemic. Buyers may gain more leverage as mortgage rates ease and supply improves. Sellers may face more competition and more realistic pricing expectations. For many Americans, the coming year could offer the first real chance in years to enter a more stable and predictable housing market.
