Realtors express positive outlook for 2026 housing market

Real estate experts are looking positively towards the 2026 housing market, with signs indicating a better year for both buyers and sellers. The average mortgage rates have seen a reduction of about one percentage point compared to the previous year. By late January 2026, a 30-year fixed-rate loan averaged 6.18%, while a 15-year fixed-rate loan averaged 5.39%. This decrease marks a three-year low and is expected to provide opportunities for more first-time homebuyers to enter the market, although rising home values continue to be a challenge. Median home values in various counties have experienced a significant increase over the years.

In addition to the decline in mortgage rates, tax deductions are also playing a role in encouraging home purchases. The Permanent Working Families Tax Cut Act passed by Congress extended deductions on mortgage interest, making them permanent. This act also includes the consideration of private mortgage insurance (PMI) as part of mortgage interest. At a state level, The Ohio Housing Finance Agency’s Mortgage Tax Credit offers a federal tax credit for a portion of home mortgage interest.

Local real estate agents have reported an increase in activity in recent months, with multiple buyers showing interest in the same properties. While lower interest rates can spur competition and result in higher home prices, well-priced and adequately marketed homes are still moving within a short timeframe. To navigate this competitive market, it is crucial for buyers to get pre-approved by a lender, buy within their budget, consider various costs associated with homeownership, and explore different lending fee options.

Challenges in the market include a shortage of inventory, which continues to put pressure on prices to increase. Despite this, real estate agents remain optimistic about the 2026 market outlook, expecting a strong year ahead. There is hope for buyers and sellers alike, with steady price points and interest rates predicted for the year. Many first-time homebuyers are leaning on assistance from family members due to the risen home prices and construction costs.

Looking ahead, most economists anticipate mortgage rates to gradually decrease as inflation stabilizes and policies are adjusted. Buyers are advised to stay informed about federal policy changes that may impact mortgage interest deductibility and other factors affecting the real estate market. Overall, a more favorable rate environment and a clearer policy direction are expected to support a healthier and more active housing market in the coming months.