Buyers are gaining ground in more US markets, yet their purchasing power keeps eroding
American homebuyers are gaining negotiating ground in more markets across the country, but a sharp run-up in mortgage rates past 7% is reducing what those buyers can actually afford to spend, the Realtor.com Market Clock report shows.
The national clock reading has moved to 4 o’clock – late balanced and loosening toward buyers – from 3 o’clock last quarter.
Two-thirds of the 99 metros tracked now favor buyers outright or are trending that way: 27 are seller’s markets, 49 balanced and loosening, 17 buyer’s markets, and six balanced and tightening.
“The tool gives buyers and sellers a picture of what’s happening now so they can make well-informed decisions in a rapidly changing market,” said Danielle Hale, chief economist at Realtor.com.
“Its latest reading shows buyers gaining ground nationally and in many markets. Even so, affordability is likely to continue as a top concern for shoppers, especially as mortgage rates above 7% limit how much home a fixed budget can buy.”
The numbers behind that concern are unambiguous. Mortgage rates climbed 74 basis points in just over five weeks – from 6.66% in late August to 7.40% on October 8.
For a buyer with a $2,000 monthly principal-and-interest budget, that surge strips more than $22,000 from the home price their budget can reach, a 7.2% reduction in purchasing power.
“More buyers can negotiate in more markets, but a bigger negotiating advantage doesn’t always mean more affordability,” said Jake Krimmel, senior economist at Realtor.com.
“As rates rise, the same monthly budget supports a lower home price. Market leverage and purchasing power are moving in opposite directions right now.”
The 30-year mortgage rate held steady this week, offering some relief for borrowers. Mike Fratantoni of the Mortgage Bankers Association says buyer expectations have shifted in today's market. https://t.co/kisGllMr2M
— Mortgage Professional America Magazine (@MPAMagazineUS) October 15, 2026
A tale of two trends
The squeeze is compounding wider pressure on broker pipelines. Builder confidence fell to a 14-year low as rising mortgage rates and construction costs battered the new-home market, with buyer traffic at its lowest since April 2012.
National Association of Home Builders (NAHB) Chief Economist Robert Dietz, based in Washington, DC, put the problem plainly.
“Housing remains squeezed by supply-side constraints and significant affordability challenges. Demand persists, but higher mortgage rates, elevated construction costs and weaker consumer confidence are keeping more buyers on the sidelines,” he said.
For brokers counseling hesitant clients, Samantha Shelton, mortgage broker and president at Align Lending, previously told Mortgage Professional America that waiting for conditions to improve carries its own cost.
“When affordability improves, competition increases,” she said.
“That’s why I often tell clients it’s better to be early and refinance later than wait and enter the market with the Black Friday crowd. A buyer who purchases before the rush may get a better price and still benefit when refinance opportunities open.”
Regional splits define the map
The Midwest holds 16 of the 27 seller’s markets, with Columbus, Indianapolis and Kansas City among 11 metros that have registered as seller’s markets for every month in the clock’s history.
The South tells the reverse story, accounting for 14 of 17 buyer’s markets, with Greenville, South Carolina, and Nashville having reached the clock’s peak-buyer position last quarter.
Forty-one metros changed clock positions over the past three months. Austin, Seattle, Salt Lake City and Portland, Oregon each moved two positions toward buyers.
With high mortgage rates expected to keep the US housing market subdued through the remainder of 2026, balanced markets including Atlanta, Denver, Jacksonville and San Antonio remain close to tipping points as the slower fall and winter season sets in.
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