A recent survey from Bank of America asked potential homebuyers what would make them more comfortable about buying a home, and the answers reveal a clear pattern. Most people want prices and interest rates to become more affordable.

Here’s the good news: even though the overall economy feels uncertain, the housing market is starting to show some positive shifts in both areas. Let’s take a closer look so you have a clear picture of what’s going on.

 Prices Are Moderating

In recent years, home prices went up really quickly, and that rapid rise made it tough for a lot of buyers to keep up. But nowadays, the increase has slowed down quite a bit. To put it in perspective, between 2020 and 2021, prices jumped by about 20% in just one year. Now, experts expect home prices to grow by only single digits this year, which is more in line with what we’d consider normal.

That’s quite a change from the fast growth we experienced just a few years back. Keep in mind, though, price trends differ depending on the neighborhood. In some places, prices will keep going up, while in others, you might see a small dip.

Home prices aren’t dropping drastically, but they are leveling off a bit. For buyers, this slowdown makes the process feel less overwhelming. It’s simpler to plan your budget when home values are changing more gradually.

Mortgage Rates Are Easing

At the same time, interest rates have dropped from their recent peak, easing some of the pressure on potential homebuyers. As Lisa Sturtevant, Chief Economist at Bright MLS, points out:

““Slower price growth coupled with a slight drop in mortgage rates will improve affordability and create a window for some buyers to get into the market.”
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— Lisa Sturtevant, Chief Economist at Bright MLS

Even a slight dip in mortgage rates can make a noticeable impact on your monthly mortgage payment. Keep in mind, though, that while rates have dropped a bit recently, they’re likely to fluctuate. So, try not to stress too much about the short-term ups and downs.

Looking ahead, mortgage rates are expected to hover in the low to mid-6% range, which is a noticeable improvement compared to a few months ago. There's also a chance they could drop even more, depending on how the economy performs.

Why This Matters

People might not feel great about the economy right now, but the housing market is starting to level out. Home prices are easing up, and interest rates have dropped from their peak.

This might not completely solve affordability issues for you, but things are definitely looking a bit different than they did earlier this year. These changes could make it easier for you to get back into the market as we head into next year.

Bottom Line

Buyers’ two biggest concerns are starting to shift. Home prices are leveling off, and interest rates are coming down. These trends look like they could continue into 2026.

If you’re thinking about moving, let’s chat about what’s going on in our area and how it could affect your plans.