Are We Heading Toward a Buyer’s Market?

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Are we heading toward a buyer’s market in 2026? This article explores that question for home buyers, sellers, and real estate professionals, providing essential insights into why understanding buyer’s market trends matters for your decisions and strategies.

For buyers, knowing when the market shifts in your favor can help you negotiate better deals and avoid overpaying. Sellers need to recognize when competition increases so they can price and market their homes effectively. Real estate professionals benefit from understanding these trends to guide clients and stay competitive.

This article will cover the definitions of a buyer’s market, key indicators to watch, current trends, and expert predictions for 2026. By the end, you’ll have a clear understanding of where leverage is shifting and what it means for your next move.

Current Housing Market Trends

According to CBS News, recent housing market analysis highlights ongoing shifts in mortgage rates and inventory, providing valuable insight into what buyers and sellers can expect in the coming months.

As of December 11, 2025, the average 30-year fixed mortgage rate is 6.22%. Many experts, including Fannie Mae and Realtor.com, predict that mortgage rates will decrease to the low- to mid-6% range in 2026, with Fannie Mae specifically forecasting a rate of 5.9% by the end of 2026. Realtor.com forecasts that mortgage rates will average 6.3% in 2026, down from 6.6% in 2025. Lower rates are expected to increase buying power for homebuyers in 2026.

Real estate markets don’t change at the same time across the board. Some cities are seeing a slowdown while others are still moving quickly with strong prices. According to recent market data, the third quarter of 2025 saw significant shifts in buyer and seller behavior. This article breaks down what a buyer’s market actually means, which indicators matter, and how the current conditions compare to past cycles. It’s built to help buyers and sellers understand where leverage is starting to shift, and where it’s still holding steady. Buyers should focus on their financial readiness and long-term plans when considering a home purchase.

What Is a Buyer’s Market (and What It Isn’t)?

A shift to a buyer’s market is indicated by more inventory, longer Days on Market (DOM), price drops, fewer bidding wars, increased contingencies, and more expired listings. Understanding these indicators is crucial for anyone navigating the real estate landscape.

A buyer’s market occurs when the number of homes for sale exceeds the number of active buyers. In this environment, buyers gain leverage and sellers face increased competition to attract offers. Less competition among buyers and more inventory on the market give buyers increased negotiating power.

Key Indicators of a Buyer’s Market

A buyer’s market is characterized by:

• More inventory: There are more homes for sale than buyers, often resulting in six months or more of supply.
• Longer Days on Market (DOM): Homes may take 60 days or more to sell, giving buyers more time to negotiate.
• Price drops: A higher percentage of listings experience price reductions, reflecting softening demand.
• Fewer bidding wars: Multiple-offer situations become rare, and buyers are less likely to compete aggressively.
• Increased contingencies: Buyers can include more contingencies in their offers, such as inspection or financing clauses.
• More expired listings: Listings that don’t sell within their contract period become more common.
• Higher contract cancellations: Increased buyer hesitancy leads to more deals falling through.
• More seller concessions: Sellers are more likely to offer help with closing costs, interest-rate buydowns, or repairs.

Buyer’s Market vs. Balanced Market

It is important to distinguish a true buyer’s market from a balanced market. In a balanced market, neither buyers nor sellers have a clear advantage. Inventory is moderate, prices are stable, and homes sell within a typical timeframe. A buyer’s market, by contrast, gives buyers more negotiating power and puts additional pressure on sellers to adjust. In a buyer’s market, the typical home may take 60 days or more to sell, giving buyers more time to negotiate.

Headlines often exaggerate market shifts. A slower market does not necessarily mean conditions favor buyers. The end of bidding wars does not indicate that home values are declining across the board. Slower price growth does not mean a market correction. When considering market conditions, overall inventory remains a key factor in determining whether the market truly favors buyers.

When they see headlines like these, many buyers wait for the perfect moment to buy, but that moment may never arrive. Markets rarely change overnight, and conditions vary significantly by location. Understanding your local market is more valuable than relying solely on national trends.

Now that you know what defines a buyer’s market and its key indicators, let’s look at why so many people believe a buyer’s market is on the horizon.

Why So Many People Think a Buyer’s Market Is Coming

Affordability and Buyer Behavior

Many potential buyers have stepped back from the real estate market because mortgage costs are now twice what they were a few years ago. For many, the deciding factor is their current financial situation—including debt, savings, and income stability—which directly impacts affordability and willingness to buy.

As a result, a lot of people can’t afford the same homes they looked at in 2021 or 2022. But as demand drops, sellers are losing the advantage they once had, which is why more people are talking about a buyer’s market.

Regional Variations

Over the past couple of years, bidding wars don’t happen as often now. In many cities, homes are taking longer to sell and often go for less than the asking price. We see sellers offering more perks, such as help with closing costs, interest-rate buydowns, and repairs to keep buyers interested.

Economic uncertainty and inflation concerns are causing many buyers to delay their home search. These changes indicate that the balance of power is shifting.

Some markets are already becoming more buyer-friendly. Cities in Florida and Texas, which had big price jumps during the pandemic, now have more homes for sale, more price cuts, and fewer aggressive offers. Meanwhile, places like Oakland, Newark, and parts of San Francisco still have limited supply and steady prices that seem to defy interest rates.

Media headlines tend to generalize about the market. They talk about national trends, but real estate is still very local. Softer conditions in one state don’t mean buyers have all the power everywhere. Some buyers can negotiate more, while others still have to pay full price to get a home. Buyers are now more aware of long-term stability and are less willing to stretch their budgets beyond comfort.

While the signs of a potential buyer’s market are real, they are uneven.

To better understand if these changes truly signal a buyer’s market, let’s examine the specific indicators.

The Signals That Actually Point Toward a Buyer’s Market

Just because the market has cooled doesn’t mean that it’s flipped. In fact, many markets are showing different signals, with some moving toward a buyer’s market faster than others. True buyer’s markets follow specific patterns, and they tend to unfold over time.

Additionally, the increase in housing inventory is expected to provide buyers with more options and negotiating power in 2026.

High Interest Rates

Interest rates are high, compared to 2021, and aren’t expected to decrease much this year. The FED is only expected drop rates once or twice in 2026. As a result, monthly payments remain relatively high, lowering purchasing power and decreasing housing affordability. As a result, potential buyers may exit the market, which decreases competition. When there are fewer buyers, the pressure that drives home price growth evaporates.

However, even modestly lower rates could encourage more buyers to enter the market in 2026, as a dip in mortgage rates can improve affordability and increase buyer activity.

Sustained Housing Inventory Growth

A rise in new listings can offer early evidence of a shifting housing market. When supply exceeds demand over several months, buyers gain greater negotiating power. In many regions, inventory is climbing, especially in markets that saw the most dramatic price growth in recent years.

More homes on the market means more competition for sellers and more options for buyers. However, overall inventory is still below pre-pandemic levels, which continues to impact market stability. Overall inventory is still limited compared to historic norms, influencing predictions about the housing market’s future.

Longer Days on Market

In a hot housing market, homes move fast, sometimes selling within a few days. During the holiday season, days on market typically lengthen, which can strengthen buyers’ negotiating power due to reduced competition and a general holiday-related slowdown.

In a buyer’s market, listings that aren’t priced competitively will linger on the market. When average days on market increase consistently, it often signals that buyer urgency has dropped. This gives buyers more time to evaluate homes, make lower offers, or ask for repairs and concessions. A longer selling window can also put psychological pressure on sellers to adjust pricing or terms.

Widespread Drop in Home Prices Across the Housing Market

Price corrections are often local and vary by price point. But when home prices fall across multiple regions and price tiers, the trend is harder to ignore. A handful of small reductions is not enough. A buyer’s market involves noticeable price adjustments that reflect softening demand and growing supply.

On the flip side, in regions where inventory remains tight, well maintained homes and well priced homes continue to sell quickly and often command strong prices, showing that accurately priced, move-in ready properties are still in high demand even as the broader market cools.

Behavior Change in Home Sellers

Sellers reveal a lot about the housing market through their behavior. Currently, concessions are increasing in many parts of the housing market. More sellers are agreeing to cover closing costs, buy down mortgage rates to help with monthly payments, or offer home warranties to sweeten the deal.

Some sellers and developers also offer incentives, such as design credits or rent discounts, to attract buyers or renters. Some are pricing more aggressively from the start or lowering their expectations after a few weeks on the market. Buyers should also consider ongoing costs like property taxes when evaluating offers and concessions. These are not just isolated tactics. They reflect broader changes in market dynamics and expectations.

While these signals are becoming more common, it’s important to understand why most markets haven’t fully shifted to a buyer’s market yet.

Why Most Markets Aren’t Buyer’s Markets Yet

Many headlines suggest a softening real estate market, and in some areas, this is accurate. However, most of the country has not reached a full buyer’s market. In 2025, many markets are seeing more inventory, but buyers only have true breathing room to negotiate in select areas. The overall housing market is expected to favor buyers slightly more than in previous years, but local conditions will vary significantly. The pace has slowed and sellers are adjusting, but buyers do not have complete leverage yet.

Supply Constraints

One reason is supply, because inventory has risen in some cities, but not enough to meet long-standing demand. Many homeowners are staying put, partly because of the low mortgage rates they locked in years ago. Trading a 3 percent rate for something closer to 7 percent makes little financial sense. This creates a supply bottleneck that limits prospective buyers’ choices and keeps pricing more stable than expected.

Lack of Turnover

A second reason is that fewer people are moving, creating a lack of turnover. With baby boomers aging in place and first-time buyers remaining cautious, homes aren’t changing hands as quickly. As a result, fewer homes are listed, and competition remains high for move-in-ready properties, especially in desirable areas.

Strong Home Equity

The last reason is that strong home equity is also preventing distressed sales. Most homeowners have built significant value in their properties over the past decade and are not under pressure to sell at a loss. This keeps inventory tight and helps home prices remain stable, even as demand cools.

The housing market is shifting gradually but has not fully transitioned. Buyers have more room to negotiate, but this is not true for all areas or listings.

To see where the market is headed, let’s review the latest trends and expert predictions for 2026.

Market Trends and Predictions

The real estate market is in a transitional phase. Recent housing market predictions, along with current mortgage trends, suggest modest 1 to 2 percent growth over the next year.

According to data from the National Association of Realtors, existing-home sales are expected to remain steady, and mortgage trends are influencing buyer affordability, demand, and overall market behavior in 2025. That pace is far from the double-digit increases seen during the peak of the pandemic, but it does indicate that values remain resilient, especially in areas with ongoing supply constraints.

Inventory

Inventory is increasing in some markets, giving buyers more leverage and options. For example, San Antonio is experiencing increased housing inventory and slowing price growth, a trend also seen in other Texas markets like Austin. However, this shift has not yet resulted in widespread buyer’s market conditions.

Mortgage Rates

Mortgage rates also remain a key factor. Higher borrowing costs have reduced buying power and sidelined many potential homeowners. At the same time, these rates discourage sellers from giving up their low-rate mortgages, keeping turnover low and inventory tighter than it might otherwise be.

Forecast

Looking ahead, home prices are expected to increase moderately in 2026 due to ongoing inventory constraints, with most forecasts predicting a 1% to 4% rise in many areas. The overall housing market is expected to become more balanced in 2026, with neither buyers nor sellers having a distinct advantage. The housing market is also expected to show signs of stabilization in 2026, with modest price growth and slightly lower mortgage rates. In 2026, the market is projected to show signs of getting back on track to what is considered normal.

The current real estate market is in a transitional phase. Prices are stable, buyers are more selective, and sellers are adapting. For now, the most likely scenario is a gradual shift, progressing neighborhood by neighborhood and listing by listing.

Understanding these trends is key, but what do they mean for buyers and sellers right now?

What This Means for Buyers Right Now

Some buyers are already seeing more room to negotiate. In housing markets with rising inventory, there is a clear advantage for those who act early. Waiting for a perfect buyer’s market can mean missing the homes with the most potential. Instead, focus on preparation.

Steps for Buyers:

1. Get financially ready: Save for a down payment, understand available down payment assistance programs, and have your finances in order.
2. Get pre-approved: Secure pre-approval to move quickly when opportunities arise.
3. Know your local market: Research neighborhoods and work with an agent who can spot early signs of price drops or motivated sellers.
4. Structure your offer carefully: Consider asking for closing cost credits, rate buydowns, or flexible terms even if the seller holds firm on price.
5. Act when ready: In an uncertain real estate market, a smart strategy matters more than timing the market.

For renters hoping to buy in 2026, preparation matters as much as the market itself.

Sellers also need to adapt to these changing conditions. Here’s what to keep in mind if you’re listing your home.

What This Means for Sellers Right Now

Sellers need to stay sharp. In most markets, neither buyers nor sellers have the upper hand, making adaptability crucial. The housing market is no longer moving at lightning speed. Overpricing leads to longer timelines and more pressure to cut later. The overall market in 2026 is anticipated to reward preparation and adaptability from both buyers and sellers.

Tips for Sellers:

• Price it right from the start: Buyers have more options, and they compare listings quickly. Homes that show well and are priced competitively still sell, but they require more effort to stand out.
• Be prepared to negotiate: Offer concessions such as:
  • Covering closing costs
  • Mortgage rate buydowns
  • Seller concessions
• Stay flexible: If your buyer wants access to the property before closing, learn more about how to protect yourself and your home.

In this housing market, sellers who adapt sell faster and closer to asking.

The impact of these trends can vary widely depending on location and price point. Let’s explore how buyer conditions differ across the market.

How Buyer Conditions Vary by Market and Price Point

In today’s market, homebuyer power depends heavily on location and price range, and many markets are experiencing different conditions. According to Jane Smith, vice president at HomeLend Mortgage, more inventory is coming online in some regions, giving buyers more options, while other areas remain competitive due to low supply or steady demand. The dynamics of the housing market in 2026 will vary significantly by region, with some areas favoring buyers and others favoring sellers.

Entry-Level vs. Luxury Markets

Price point matters, which is why we see entry-level homes tend to be the most competitive in all market conditions. Less expensive properties attract interest from a larger audience. However, the luxury market reacts faster to changes in market dynamics, so we see slower movement and more negotiation, creating better conditions for buyers at higher price tiers.

National averages can mislead buyers and sellers. Instead, you need to look at micro-economic market data. Local real estate markets operate on different timelines. A balanced market in one suburb can sit next to a buyer’s market in another, even within the same metro area.

New construction also changes the equation. Builders may offer rate buydowns, design credits, or other incentives to close deals, while resale listings rely more on traditional pricing and negotiation.

Understanding your local market and property type is essential. This is where the buyer strategy takes shape.

So, what does a buyer’s market actually mean for home prices?

What a Buyer’s Market Would Mean for Home Prices

A buyer’s market shifts the balance of power. When inventory levels stay high and there is less competition among buyers, more inventory gives buyers increased breathing room to make decisions. This environment allows buyers to take their time, evaluate options, and negotiate more confidently. In 2026, buyers are expected to have even more time to evaluate listings and negotiate terms due to increased inventory and a cooling market.

Here’s how that change typically plays out in home prices:

• Price stabilization or gradual declines: Homes may sell below list price or remain flat year over year, with price drops occurring gradually.
• Increased negotiation room: Buyers can request repairs, credits, or lower offers without being outbid.
• Fewer escalation clauses and bidding wars: Competitive offer situations become rare, reducing pressure to overpay.
• More frequent price reductions: Listings that don’t attract interest often see price drops within the first few weeks.
• Higher use of concessions: Sellers may offer closing cost credits, interest rate buydowns, or home warranties to attract buyers.

Not every market will respond the same way. Some areas may see slight declines, while others remain steady due to limited supply. Overall, a buyer’s market creates more opportunities for negotiation and greater flexibility on price.

It’s important to distinguish between a balanced market and a true buyer’s market. Here’s why that difference matters.

Balanced Market vs Buyer’s Market — Why the Difference Matters

While a balanced market can feel like a buyer’s market, particularly when coming out of a hot seller’s market, they are not the same.

Before making a purchase, buyers should carefully assess their financial situation and financial readiness. This means understanding your current debt levels, savings, and income stability to determine what you can afford and how you can adapt to changing market conditions. The best time for prospective buyers is when they find a home that meets their needs and that they can afford.

A balanced market gives both buyers and sellers room to negotiate. Homes sell at a steady pace. Prices hold relatively stable. No one side has a clear advantage. Supply and demand are in sync. Many housing markets are trending toward balance. The intense seller-driven conditions of recent years have eased, but most areas have not fully shifted to a buyer’s market.

A balanced market, like what most areas are currently experiencing, feels slower than the frenzy of 2021, but that does not mean prices are falling everywhere. Buyers may see more opportunity, but sellers can still achieve strong outcomes with the right strategy.

The benefit of balanced markets is that sellers are rewarded by listing preparation and realistic expectations, while buyers have time to think. The pace is calmer, but transactions are still happening every day.

What could push the market further toward buyers in the future? Let’s look at the factors that could accelerate this shift.

What Could Push the Market Further Toward Buyers

Balanced markets can shift into a seller’s or buyer’s market under the right economic pressures. Several factors could accelerate the shift toward a buyer’s market, such as:

• Increased housing supply: More listings reduce competition and give buyers greater choice. This could result from new construction, more homeowners deciding to sell, or an increase in investment property sales.
• Economic slowdown or job losses: A weaker job market can reduce buyer demand, leading to longer listing times and price reductions.
• Sustained affordability challenges: If mortgage rates remain high and wages do not keep pace, more buyers may pause their search, slowing the market and forcing sellers to offer more concessions.
• Shifts in homeowner confidence: If homeowners believe prices have peaked, more may choose to list before values decline, increasing downward pressure on prices.

To navigate these shifts, local expertise is more important than ever. Here’s how real estate professionals can help.

How Local Real Estate Experts Help Interpret Market Shifts

No headline can capture local market conditions. Local agents observe data trends and buyer behavior before they get reported in news articles. Real estate agents know which listings receive offers, which remain unsold, and can identify buyer hesitation, seller urgency, and changing negotiation patterns as they develop. Neighborhood-level data almost always differ from national trends. A well-connected agent can identify these patterns early and use them to your advantage. In a shifting market, well-maintained homes and well-priced homes are more likely to sell quickly, while properties that are not move-in ready or are overpriced may struggle to attract buyers. Many homeowners are also sitting on a sizable amount of home equity, which influences their decisions to sell or stay.

An experienced real estate agent doesn’t just track market stats; they also translate them into a strategy for their clients. By sharing their market knowledge, they help buyers understand where they have leverage and where patience matters more. When working with sellers, they adjust pricing and marketing before a listing goes stale. Whether you’re buying or selling, the right real estate agent helps you take on the market with confidence.

So, are we heading toward a buyer’s market in 2026? Here’s a summary of what you need to know.

Summary: Are We Heading Toward a Buyer’s Market?

While buyer leverage is increasing in some areas, the overall housing market in 2026 is expected to be more balanced, with neither buyers nor sellers having a clear advantage. Local conditions will vary significantly. Some markets may offer more negotiating power to buyers, especially where inventory is rising and demand is cooling, but most regions are likely to experience a neutral stance. The best opportunities will depend on your local market, preparation, and timing.

Whether you’re buying or selling, the right agent helps you read the market clearly and act with confidence. FastExpert connects you with experienced local real estate agents who understand what’s happening right now, where you live.