A glacial advance occurs in housing capacity. While this can be proven statistically, it may not feel dramatic enough to change the plans of many buyers or sellers. Here is the housing market forecast for March 2026.
Jim Breeze, a senior vice president at PNC Bank, expects March to be about the same as last year, and maybe “a little bit better.”
Last year, PNC saw a 47% increase in mortgage applications from January to April, with an initial peak in March (up 38% from January 2025).
“This is really typical for the mortgage industry as a whole,” Breeze told Yahoo Finance. “November, December and January are slow. Then you start entering the time frame when people are really thinking about making that move. So they’re looking to prepare for the summer months.”
Breeze noted that planning ahead is key. Speaking with a mortgage advisor before you go house hunting can highlight potential eligibility levers that can be pulled.
“There are a lot of down payment assistance programs out there that people don’t know about. If they do talk to someone, that dream of affordability will increase because now there’s another mechanism to help you get into a new home,” he said.
Read more: Down payment assistance: how it works and how to qualify
Housing affordability is slowly increasing. A new Zillow analysis found that affordability has increased by more than $30,000 compared to a year ago, due to rising incomes and falling mortgage rates. This means that a median income family can now afford a $331,483 home. This is the cheapest price since March 2022, Zillow said.
Here’s a closer look at the factors that affect home affordability in March.
Mortgage rates are slowly becoming more favorable, falling to levels not seen since September 2022.
Mortgage rates began a slow decline in mid-November. Now, other sources report loan rates under 6%. Yahoo Finance’s weekly survey of borrower rates shows 30-year fixed rates are as low as 5.5% — rates were up slightly from 7% a year ago.
If rates remain calm or even lower in March, buying and refinancing activity will pick up.
“Mortgage rate stability near 6% this spring marks a significant turnaround where, for the first time since the pandemic, both the psychological barrier and the numerical threshold of 5% have been reached,” Realtor.com economist Jia Su said in a statement. “A lower price may bring more homeowners who were previously ‘locked out’ to finally re-enter the market.”
Home price growth is slowing, with housing market appreciation at its lowest since the recovery began after the Great Recession, according to the S&P Totality Case-Shiller Index.
This can be a double-edged sword: Buyers welcome moderate price gains, but home sellers may take their listings off the market, hoping for more favorable price conditions.
“2025 marked the end of an unprecedented period of price growth,” said Thom Malone, chief economist at Quotlet. “Following five years of gains – including a 19% peak in 2021 – growth has fallen to just 1.3% in 2025. The market is now waiting for the broader economy to catch up.”
Malone expects only modest growth in 2026.
Read more: This map shows median home prices by state
Nearly two-thirds (62.2%) of home buyers in 2025 received a discount off the list price. Redfin’s analysis of MLS listings found that the typical buyer received a 7.9% price reduction — the largest since 2012.
“Homebuyers in 2026 shouldn’t ignore homes that are slightly above their budget because there’s a good chance they’ll get some kind of discount from the seller, whether it’s a price reduction, money for closing costs, or funds for renovations,” reported Redfin Senior Economist Asad Khan.
Redfin reported that as of February 22, 2025, there was a 5.1-month supply of homes for sale. “A 4- to 5-month supply is considered balanced, with a lower number indicating seller’s market conditions,” Redfin noted.
However, Realtor.com’s latest Housing Supply Gap Report found that new construction cannot keep up with demand, and the housing supply gap widens by 4 million homes by 2025.
“Even when annual construction and household composition are roughly balanced, the market is still more than a decade out of construction,” Daniel Hill, Realtor.com’s chief economist, said in a statement.
New listings were 80,595, down 2.8% year-over-year, according to Redfin.
Redfin reports that the average days on the market is 67, an increase of eight days, and the longest in nearly seven years.
The Mortgage Bankers Association says it’s getting progressively easier to qualify for a mortgage based on a credit availability index. The amount of credit available decreased in November 2023, and has generally been increasing since then – a sign of credit crunch.
“The start of the year is typically when lenders position themselves for spring home buying, and the recent drop in mortgage rates has provided a window of refinancing opportunities, including refinancing into ARM loans,” Joel Kahn, MBA’s deputy chief economist, said in a report.
