Analyst says housing market may be entering a new era
National home prices are expected to remain largely flat in 2026, marking the start of what Compass chief economist Mike Simonsen described as a “next era” of the housing market in an interview on CNBC’s Fast Money.
Simonsen said that after four years of stagnant sales and rapidly rising prices, conditions are set to shift. “Sales are starting to move higher, but prices capped or maybe down, incomes are rising faster than prices, and so affordability improves for the first time in a bunch of years,” he explained. While not a dramatic change, Simonsen said the trend signals a longer-term adjustment in the market.
Data on listings also informs Compass’ forecast. Simonsen highlighted the growing phenomenon of withdrawn listings in 2025, noting that many homeowners are temporarily removing their properties from the market rather than cutting prices. “It can be tempting to look at that as shadow supply, like supply inventory that’s going to hit the market. But the people in there are actually owner-occupiers,” he said. According to Compass, roughly 150,000 homeowners delayed moving in previous years could transact in 2026, representing what Simonsen calls “shadow demand.”
Florida is expected to be a leading market for increased transactions. Simonsen noted that weekly pending sales in the state are already 10% to 15% higher than last year. In contrast, the New York tri-state area and Chicago have experienced slower sales due to tight inventory, though modest increases in supply next year could allow transactions to grow in these regions.
Simonsen said they expect mortgage rates to remain near the low-6% range, emphasizing that buyers are more sensitive to changes than absolute levels. A potential decline toward 6% in the first quarter, he added, could further boost sales in the strongest months of the year.
Overall, Compass’ outlook for 2026 points to a market where moderate inventory growth, stable home prices, and improving affordability could encourage more buyers and sellers to participate after several years of constrained activity.
