2026 Housing Reset: 22 Major U.S. Cities to See Price Drops, Florida Leads Losses

A clearer market: what Realtor.com’s 2026 forecast means for real estate USA

If you are watching the real estate USA market, the headline is simple and hard to ignore: prices are likely to fall in 22 of the 100 largest U.S. cities in 2026, and mortgage rates should ease slightly. That combination could shift bargaining power after years of a seller-skewed market. Our analysis of the Realtor.com report and related Zillow projections shows a market that is moving toward balance — but that shift brings both opportunity and new risks.

Jake Krimmel, senior economist at Realtor.com, told CBS News that 2026 will be “the most balanced housing market” since the pandemic, meaning neither buyers nor sellers should expect a clear advantage. That is a meaningful claim given how extreme the market swung during 2020–22.

Quick facts to start

• 22 of the 100 largest U.S. metros are forecast to see price declines in 2026 (Realtor.com).
• Mortgage rates are expected to fall from an average of 6.6% in 2025 to 6.3% in 2026 (Realtor.com).
• Realtor.com projects existing-home sales will rise to 4.13 million in 2026 (under 2% growth from 2025).
• Zillow projects a larger uptick to nearly 4.3 million existing-home sales (about 4.3% growth).
• The largest projected drops are in Florida: Cape Coral–Fort Lauderdale down 10.2%, North Port–Sarasota–Bradenton down 8.9%.

These numbers are the backbone of the story. They are specific and actionable, and they should reshape how buyers, sellers and investors plan for the year ahead.

Regional patterns: why Florida and parts of the West slide while most cities rise

Realtor.com’s breakdown shows the bulk of expected declines clustered in the Southeast and the West. Florida is singled out: seven of the eight largest Florida metros in the analysis are forecast to fall, with Miami the only exception.

Why these areas? The report points to two clear dynamics:

• Inventory expansion. Markets that saw heavy price growth during the pandemic now have more homes for sale, giving buyers choice and easing upward pressure on prices.
• Normalization of demand. COVID-era buying patterns — low rates and remote work — drove demand in second-home and sunbelt markets. As borrowing conditions and work arrangements shift back toward pre-pandemic norms, demand in some of those places is slipping.

This is not a uniform correction. Realtor.com still expects price growth in 78 of the 100 largest metros, but at a moderate clip: a median gain of 4% among those markets.

From an investor standpoint, that split matters. Markets with falling prices may deliver short-term pain but could create entry points if local fundamentals — jobs, wages, construction activity — remain solid. Markets with modest growth may deliver steadier returns but at higher purchase prices.

Mortgage rates and transaction volumes: modest relief, but not a return to the boom

Both Realtor.com and Zillow expect mortgage rates to hover just above 6% in 2026. Realtor.com’s baseline is a dip to 6.3%, down from 6.6% in 2025. Zillow expects mortgage rates to stay “just above 6%,” framing the move as modest by historical standards but still materially higher than the ultra-low rates seen earlier in the decade.

What that means for buying power:

• A one-third percentage point drop (from 6.6% to 6.3%) improves affordability but does not reset it to the levels that fueled the pandemic boom.
• Small improvements in rates combined with slowly rising wages can nudge buyers back into the market, which is what both Realtor.com and Zillow expect — the former forecasts 4.13 million existing-home sales, the latter nearly 4.3 million.

Those increases in transactions are modest, but they signal a market that is no longer stuck. For homeowners who delayed selling in 2024–25 because of rate or market concerns, 2026 may be the first year where they see reasonable buyer interest without the extremes of a bidding-war environment.

What buyers should do: tactical steps for 2026

We see genuine buying opportunities, but they require discipline. Here are practical strategies for different buyer types.

For first-time buyers:

• Lock in pre-approval early. A small move in rates changes monthly payment materially. Pre-approval preserves negotiating leverage when inventory is growing.
• Focus on metros with wage and job growth, not just price corrections; falling prices can be a red flag if the local economy is weakening.

For repeat buyers and movers:

• Time your listing and purchase. Increased inventory gives sellers less certainty; buyers who sell and buy can use contingencies more effectively.
• Use inspections and appraisal contingencies to avoid overpaying in markets that have seen rapid prior gains.

For investors and buy-to-let buyers:

• Target metros with persistent rental demand and rental yields that cover higher borrowing costs.
• Stress-test cashflow at 6.3%–6.6% mortgage rates, not at the 3%–4% rates of recent years.

Across the board, our analysis recommends negotiating on price in the 22 metros flagged for declines, while remaining realistic about growth potential in the 78 metros expected to rise modestly.

What sellers and current owners should consider

Sellers face a more complex calculus. In markets with expected declines, pricing discipline matters. In markets with modest growth, buyers will still expect value for money.

Practical seller actions:

• Price competitively. As inventory increases, days on market will rise in some metros; overpriced listings will gather showings but few offers.
• Invest selectively. Small fixes that improve perceived value can pay off, but large-scale renovations should be justified by comparable sales.
• Consult local comps frequently; national forecasts are useful but local supply and demand determine transaction outcomes.

For owners thinking about timing a sale and relocation, be candid about affordability at your destination. If you plan to buy in a metro where prices are rising, you may face a trade-off between capturing gains from a sale and paying more at the destination.

Where the risks live: insurance, climate, and job markets

The Realtor.com analysis weighted inventory, construction, price growth, wages and unemployment in its projections. That is sensible, but some risks are not captured in headline forecasts.

• Insurance and climate risk: Florida is a cautionary example.