If you are asking whether 2026 is a good time to buy a home, you are not alone. After several years of one of the most difficult buying environments in recent memory — rising rates, near-zero inventory, and relentless competition — the housing market is beginning to look different. Not dramatically different. But meaningfully so.
The honest answer is: it depends on your situation. The market conditions this year are more favorable than they have been in some time. Understanding what is driving that shift helps you make a clearer decision.
Here is how we are thinking about it.
What Has Changed That Makes 2026 a Good Time to Buy a Home
The past few years were defined by a specific set of conditions. Historically low inventory. Rates that climbed sharply from pandemic-era lows. A lock-in effect that kept homeowners in place because selling meant trading a 3% mortgage for a 7% one. The result was a market that frustrated buyers at almost every price point.
Several of those conditions are shifting in 2026.
Inventory is improving. According to the National Association of Realtors, existing home sales are forecast to rise as much as 14% in 2026 as mortgage rates ease and pent-up demand releases. Nationally, active listings were up 4.6% year over year as of April 2026. That is not a flood of new supply. It is meaningful relief compared to where the market was two years ago.
Rates have moderated. Realtor.com forecasts mortgage rates to average around 6.3% in 2026 — down from the peaks of 2023. As Realtor.com senior economist Joel Berner has noted, rates are falling faster than prices are rising. Monthly payments are coming down even as prices inch up. Affordability is improving in a practical sense, even if the headline numbers do not always reflect that.
The lock-in effect is beginning to thaw. Compass Intelligence describes 2026 as the beginning of a thaw after what they call “The Great Stay” — a period of frozen mobility driven by economic uncertainty and diminished affordability. As life circumstances change and rates ease, more homeowners are re-entering the market as sellers. That adds supply and creates more options for buyers.
Why 2026 Is Still Not an Easy Time to Buy a Home
Being clear-eyed about 2026 means acknowledging what is still difficult.
Affordability remains a real challenge. J.P. Morgan notes that the National Association of Realtors’ affordability index is still roughly 35% below its pre-COVID level. Lower rates help, but they have not fully closed that gap. Buyers — especially first-time buyers — are entering a market where purchasing power is meaningfully lower than it was five years ago.
Inventory is improving, not recovered. Realtor.com projects inventory to grow nearly 9% nationally in 2026, which is encouraging. But the starting point was historically low. More supply than last year does not mean ample supply. Competition for well-priced, well-located homes remains real, and the best properties in strong neighborhoods still move quickly.
Prices are not falling. Realtor.com forecasts a modest 2.2% national price increase in 2026. Buyers waiting for a significant price correction are, based on available data, waiting for something that is not projected to arrive. The market is stabilizing, not correcting.
Is 2026 a Good Time to Buy a Home in Minnesota?
National data tells a useful story. The Minnesota market tells a more specific one, and it is worth paying attention to both.
Minnesota has the highest homeownership rate in the nation for people under 35, according to U.S. Census data, and a 71% overall household ownership rate. Demand here is structural and consistent — not speculative.
The Twin Cities metro remains competitive. Inventory sits at roughly 3.9 months of supply, which technically favors sellers. Median sale prices in the metro area rose nearly 7% in 2025 to $331,500, and modest appreciation is expected to continue through 2026.
That said, the picture is nuanced by price segment. The entry-level market — homes under $350,000 — remains tight, with persistent demand from first-time buyers and investors. The move-up segment between $400,000 and $700,000 has seen the most meaningful inventory improvement. More sellers in that range have adjusted to the current rate environment and re-entered the market. For pre-approved buyers ready to move, there is more to work with in 2026 than there has been in several years.
Outer-ring suburbs — including communities like Lakeville, Chanhassen, and Rogers — have seen active new construction, which offers buyers an alternative path in a competitive resale market, often with builder incentives on financing or upgrades.
Is 2026 a Good Time to Buy a Home — For You Specifically?
The market data is useful context. But the question that actually matters is not “is the market good?” It is “is this the right time for me?”
That question has a different answer depending on where you are.
If you are financially ready and have found the right home, waiting for better conditions carries real cost. You are likely paying rent in the interim. Prices are not projected to fall. And the homes that fit your life best may not be available when you decide the market has improved enough to act.
If you are stretching to make the numbers work, the improved conditions of 2026 do not change the fundamentals. A home that is difficult to afford at today’s rates is a financial vulnerability, not just a purchase. Getting the financial foundation right — credit, down payment, debt-to-income ratio — before buying is still the most important preparation you can do.
If you are a move-up buyer who has been reluctant to trade your existing rate for a higher one, the improving inventory in the mid-range segment is worth reconsidering. The lock-in effect is real. But it is also a financial calculation worth running again with current numbers. In some cases, the math is more favorable than it was a year ago.
If you are a first-time buyer, 2026 offers more options and less bidding war pressure than 2021 or 2022. It is still competitive in the right price ranges. Being prepared — pre-approved and clear on your priorities — is what separates buyers who find homes from buyers who keep losing them.
How to Decide if 2026 Is a Good Time to Buy a Home
A few things worth doing before making any decisions:
Get pre-approved, not just pre-qualified. A pre-approval based on verified income and credit gives you a real picture of what you can borrow and at what cost. It also makes you a credible buyer in a market where sellers still have options.
Run the rent vs. buy math with current numbers. Online calculators give a rough picture. A conversation with a lender and a local real estate professional gives a more accurate one. The break-even point depends on how long you plan to stay, what you pay in rent, and what local prices are doing.
Define what you are actually looking for before you start looking. Buyers who move through the search most efficiently do the thinking before the search begins. Neighborhood priorities, space requirements, and real trade-offs — getting clear on these before touring homes saves time and reduces the emotional churn of touring properties that were never the right fit.
Work with someone who knows the local market. National data is directional. What is happening in your specific price range and target neighborhood is what actually determines how you need to show up as a buyer. An experienced local agent is the most practical source of that intelligence.
How RESIDE Approaches the Buying Conversation
Our real estate team works with buyers at every stage — from early research to active search to closing. We do not push timelines. We help people think clearly about their situation and move forward when the conditions are right for them — not because the calendar says so.
If you are trying to figure out whether 2026 makes sense for your move, we would be glad to have that conversation. It starts with understanding where you are, what you are looking for, and what the market in your target area actually looks like right now.
Schedule a consultation with the RESIDE real estate team here.
Frequently Asked Questions
Will home prices drop in 2026?
Based on current forecasts from Realtor.com and J.P. Morgan, a meaningful national price decline is not projected. Realtor.com forecasts modest price growth of around 2.2% nationally. Prices are stabilizing rather than correcting, and inventory improvements are gradual rather than dramatic.
Should I wait for mortgage rates to drop further before buying?
Timing the rate market is difficult, and waiting carries its own costs — continued rent payments, potential price appreciation, and the risk that the home you want will not be available when you decide to act. Many buyers in 2026 are choosing to buy now and refinance if rates improve meaningfully, a strategy sometimes described as “marry the house, date the rate.”
Is it still a seller’s market in Minnesota?
In most Minnesota markets, yes — though less dramatically so than in 2021 and 2022. Inventory at roughly 3.9 months of supply still technically favors sellers, but the competitive dynamics have moderated. First offers are not always winning. Inspection contingencies are more common. The environment is more navigable for prepared buyers.
What does “pre-approved” mean and why does it matter?
Pre-approval means a lender has verified your income, assets, and credit and issued a conditional commitment to lend up to a specific amount. It differs from pre-qualification, which is based on unverified self-reported information. In a competitive market, sellers and their agents treat pre-approved buyers more seriously than pre-qualified ones.
How is the Minnesota market different from national trends?
Minnesota’s long-standing inventory shortage means the market here has remained more competitive than some national averages suggest. The Twin Cities metro in particular has sustained strong demand driven by employment, quality of life, and the highest under-35 homeownership rate in the nation. Local conditions vary meaningfully by price range and submarket, which is why working with an agent who knows the specific area matters.
