Part One: What Homebuyers Should Know About the 2026 Housing Market and How to Start Preparing Now

Mortgage rates appear to be trending in a more favorable direction, and many experts believe 2026 could present meaningful opportunities for homebuyers—especially first-time buyers and those planning a relocation.

Since late spring 2025, mortgage rates have gradually declined, improving affordability and restoring buyer confidence. As rates stabilize and inventory begins to grow, buyers who prepare early may be best positioned to take advantage of changing market conditions.

If buying a home is part of your 2026 plan, now is the time to start preparing—even before you’re ready to make an offer.

What Could the 2026 Housing Market Look Like?

While much of 2025 leaned toward a seller’s market, indicators suggest 2026 may begin to shift toward a more buyer-friendly environment.

A buyer’s market occurs when there are more homes available than buyers, giving purchasers greater negotiating power on price, contingencies, and timelines. A seller’s market is the opposite, favoring homeowners with limited inventory and strong demand.

Looking ahead, the National Association of Realtors anticipates growth in both existing-home and new-construction sales, alongside a modest easing of mortgage rates. Rising mortgage application activity suggests many buyers are already preparing to re-enter the market.

Why Preparation Matters More Than Ever

If more buyers return to the market in 2026, competition could increase quickly—especially in high-demand or relocation-driven areas. Buyers who are financially prepared will be able to move faster, negotiate more confidently, and avoid unnecessary stress.

Here are three smart steps you can start now to get ahead—well before you apply for a mortgage.

Step 1: Give Yourself a Financial Checkup

Start by reviewing your income, savings, debts, and spending habits. Ask yourself:

• How comfortable am I with a down payment?
• What monthly payment feels manageable?
• How much of my income goes toward existing debt?

For many buyers, a mortgage simply replaces rent—often while building long-term equity. Understanding your financial starting point early helps set realistic expectations and guides the rest of your preparation.

Step 2: Improve (or Protect) Your Credit Score

Your credit score is one of the most important factors lenders use to determine your mortgage options and interest rate.

Now is the time to:

• Check your credit report
• Correct any errors
• Pay down existing balances
• Avoid opening new credit accounts

Because credit improvements take time, starting early can significantly expand your loan options when you’re ready to buy.

Step 3: Start Strengthening Your Savings

While a 20% down payment is not required for most buyers, increasing your savings can lower your monthly payment and long-term interest costs.

In addition to a down payment, plan for closing costs, which typically range from 2%–4% of the purchase price. Some programs—and employer-sponsored relocation benefits—may help offset these costs.

What’s Next?

Understanding the market and beginning your financial preparation now can make a meaningful difference when you’re ready to buy.

In Part Two, we’ll cover the remaining steps that help turn preparation into action—from organizing documents and understanding affordability to monitoring rates and getting pre-approved so you can move quickly when the time is right.