Zillow, NAR, and Fannie Mae Align on 3.1% Home Price Growth Forecast for 2026

Three of the most closely followed home price forecasters — Zillow, the National Association of Realtors, and Fannie Mae's Economic and Strategic Research Group — have converged on a 2026 full-year national home price appreciation forecast of approximately 3.1%, a level of forecaster agreement that is unusual in a market environment that has produced significant divergence in recent years.

The consensus reflects a view that easing mortgage rates will stimulate enough demand to absorb the modest inventory increases currently underway, preventing the price corrections some bears had anticipated, while also limiting the kind of double-digit appreciation seen during the pandemic years. In the language of housing economists, 2026 is shaping up to be a 'soft landing' year for prices — meaningful appreciation, but nothing that exacerbates the existing affordability crisis.

Regional variation, however, is expected to be significant. Zillow's market-level forecasts project home price declines in Austin (-2.1%), Jacksonville (-1.4%), and Boise (-0.8%) as those overbuilt Sun Belt markets continue absorbing excess supply. At the same time, markets like Hartford, Providence, and Albany are forecast to appreciate 6% to 8% as northeastern buyers priced out of Boston and New York find value in secondary cities.

The Midwest continues to look attractive on a relative value basis. Columbus, Indianapolis, and Kansas City are all forecast to appreciate in the 5% to 6% range, driven by strong in-migration from coastal metros, healthy job markets anchored by healthcare and technology sectors, and home prices that remain meaningfully below the national median. First-time buyer activity is particularly strong in these markets.

Fannie Mae's forecast incorporates a scenario analysis showing that the range of outcomes is wider than the headline number suggests. In an upside scenario where the Fed cuts rates twice more this year and mortgage rates fall to 5.5%, national price appreciation could reach 5.4%. In a downside scenario where inflation re-accelerates and rates climb back above 7%, appreciation falls to essentially flat at 0.6%.

For practitioners, the consensus forecast has practical implications for pricing strategy. Sellers who price aggressively above comparable sales are likely to face longer market times and eventual concessions in most markets. Buyers who wait for significant price corrections in most metropolitan areas are likely to be disappointed — and may find themselves competing against more buyers as rates ease and pent-up demand returns to the market.