Compass Market Outlook: 2026 Will Bring the Most Balanced Housing Market in Years

Core Insights - Compass, Inc. releases its first Housing Market Outlook, indicating a recalibration of the U.S. housing market post-pandemic, characterized by slow home sales and high prices [1] - The report anticipates a shift in market dynamics, with rising incomes outpacing home prices, leading to increased opportunities for buyers and sellers [2] Market Dynamics - Expectations are resetting as prices flatten, inventory increases by 5%, and mortgage rates average around 6.4%, supporting a forecasted increase in existing home sales by 4.25% to 5% from 2025 [2] - The report highlights that national averages may mask regional differences, with constrained supply in the Northeast and Midwest contrasting with price dips in some Sun Belt states due to excess inventory [3] Luxury Market Performance - The luxury housing market, defined as transactions over $1 million, is expected to continue thriving in 2026, driven by affluent buyers who are less sensitive to interest rates and benefit from strong financial markets [4] Overall Outlook - Compass predicts that 2026 will be a turning point for the U.S. housing market, with growth in home sales as inventory and wages rise while prices remain flat [5]