Lessons from the first half of the 2026 housing market

The housing market in early 2026 showed normalization rather than extremes, with inventory above pandemic lows but below pre-pandemic norms. Demand remained resilient despite higher mortgage rates. Market strength varied locally, with some Midwest and Northeast areas outperforming Sun Belt markets, which are returning to traditional conditions. Inventory growth slowed and new listings stayed below historical levels, raising questions about supply constraints and homeowner mobility.