NAR Chief Economist Lawrence Yun Slashes 2026 Forecast: Existing-Home Sales and Prices Seen Growing 2% or Less
National Association of Realtors (NAR) Chief Economist Lawrence Yun has sharply revised his 2026 U.S. housing forecast downward. Yun now expects existing-home sales volume and prices to grow around 2% or less in 2026 compared with 2025, while new-home sales are projected to decrease by 5% year over year. Yun told Realtor.com that fast-rising mortgage rates are the main reason for the revision.
The downgrade came in two steps. Last November, Yun projected existing-home sales would rise 14% in 2026 from the three-decade low reached the year before, while forecasting that median prices would grow by 4%. By April, he had already tempered expectations, projecting that existing-home sales volume would rise just 4% from last year, citing high interest rates, inflation, and growing economic instability from the Iran war. The latest update cuts that figure to around 2% or less.
Mortgage rates are the swing variable. Yun had initially predicted that mortgage rates would average around 6.5% for the year. Instead, rates have steadily climbed and have remained above 7% since the last week of September, raising the monthly payment on the same loan amount and further denting buyer purchasing power. "Markets are constantly changing—some have a positive impact on the housing market, and others, negative. The big unpleasant event over recent months is the fast-rising mortgage rates, therefore further denting the market outlook," he told Realtor.com. He also noted that if rates fall toward 6% in early 2027, sidelined buyers could be unlocked.
At the Mortgage Bankers Association's annual conference earlier this month, MBA Chief Economist Mike Fratantoni predicted mortgage rates would remain around 7.3% for the rest of the year and hover above 7% through 2027. "Inflation is too high, leading central banks to raise short-term rates, while budget deficits and debt are unsustainably high, leading bond investors to push up longer-term rates," he said.
Source: GSM·USA (compiled from Realtor.com reporting)
Source: GSM · USA (original Chinese edition)
Photo: 图：内华达州 Las Vegas 西郊 Summerlin 社区住宅区航拍（资料图）。照片：Ken Lund，CC BY-SA 2.0，经 Wikimedia Commons。Photo: Aerial view of residential neighborhoods in Summerlin, Las Vegas, Nevada (file photo). Photo: Ken Lund, CC BY-SA 2.0, via Wikimedia Commons.
