The housing market at a glance
- The housing market is showing signs of recovery, but 2026 is still unlikely to see a “buyer’s market.”
- Home prices continue to creep up as in recent years but much more slowly than during the boom of 2020–2022.1
- Housing inventory is still relatively tight but 2025 showed notable growth.2
- Industry experts predict interest rates will gradually decrease in 2026.3
- Homeownership is still an excellent way to build wealth—especially compared to renting.
- Current homeowners may have more refinance and equity opportunities than they realize.
Interest rates stabilize
Following big changes in the early 2020s to housing market drivers including interest rates, inventory, and average home prices, many of these dynamics have reached and maintained relative stability in recent years. Interest rates for 30-year fixed-rate mortgages, for example, remained within a range of a little more than 1 point throughout 2024 and 2025.4
Housing prices show signs of cooling
According to data from last year, the median sale price of homes in the U.S. was $410,800, down nearly 1% from one year prior.5 This could be caused in part by rising inventory; one report showed a 10.9% increase in inventory to 1.52 million units in October 2025 compared to one year prior.2
New construction bargains buck historic trends
Surprisingly, last year saw one major shift in the housing market compared to recent decades: New-construction homes were coming close to matching—and at times even surpassing—affordability of existing homes. In June 2025, the median sale price for a new construction was about $28,000 cheaper than that of an existing home, which amounts to a 6.5% discount.6
Wintrust Mortgage SVP of Capital Markets Tim Tuz notes, “I believe construction to permanent loans will continue to grow as more borrowers choose to build their home instead of purchasing an existing home.”7
Homeownership holds strong as a way of building wealth
Despite subtle changes in the housing market, owning a home is still one of the best ways to build wealth. One report shows American homeowners with mortgages held nearly $35.8 trillion in home equity in Q2 2025, up more than 72% ($15+ trillion) compared to just five years prior in Q2 2020.8
Existing homeowners could use home equity to their advantage
Given the massive amounts of home equity that current American homeowners hold, refinancing could help you tap into your home equity to pay for other things, such as higher interest debt, education, or home renovations—or, it could simply help you lower your monthly mortgage payments or adjust your rate term to save over the life of your loan. Between rate-and-term, cash-out, cash-in, and streamline refinances, homeowners have a wide variety of refinancing options9 to consider in accomplishing long-term financial goals.
“Buyer’s market” conditions may still be far off
While many buyers may have hoped for more favorable shifts—including lower interest rates or home prices—experts suggest significant improvement for buyers is unlikely this year. While some are projecting home sales to increase by as much as 14%, this will also come with an estimated 4% rise in prices.10
Despite some promising signs of improvement after years of stagnation, it’s difficult to predict when the market will become more favorable for homebuyers. When considering that the alternative is paying rent, 100% of which goes to a landlord and prevents the opportunity to build home equity, waiting for a particular interest rate or home price might not best align with your long-term financial goals.
Building or renovating could widen options
For some would-be buyers, these changes may not be promising enough to draw them into the market for existing homes—but that doesn’t mean they’re without options. Those who are having trouble finding what they want can start either a renovation or new-construction project to help create the home of their dreams. From remodels to additions to brand-new homes built from the ground up, many can achieve their goals without having to house hunt.
Turn your existing home into a dream with renovations
With custom renovations, homeowners can make their current homes uniquely their own. Others might choose to buy and renovate a fixer-upper. Renovation loans are designed to finance these types of projects and could:
- Save time and money with one loan. Whether renovating your current home or looking for a new one, you can purchase or refinance while securing renovation financing in a single loan. One loan means one application, one closing, and one set of closing costs.
- Offer flexible options and wide eligibility. Some renovation loans have low down payment options, flexible credit score requirements, and eligibility on a wide range of property types.
- Cover a range of projects and improvements. Tackle renovation projects large and small with loan funding for roofing, plumbing, flooring, landscaping work, and more.
Break ground on your future with a new construction
For those who have an even more refined vision of what they want home to look like, new-construction loans allow borrowers to build a new home from the ground up. Construction-to-permanent loans allow you to:
- Save time and money with one loan. Your construction loan will automatically convert into a permanent mortgage. One loan means one set of closing costs; keep that extra cash for a rainy day, or put more toward perfecting your home.
- Find your ideal location. Rather than searching for the perfect home in your desired location, you can decide where you want to live first. Once you know you’re right where you want to be, you can begin bringing your plan to life.
- Reduce risk of changes in the market. When taking out a separate construction loan first, there is risk involved in how the market might change before construction is completed. It might become more difficult to secure a permanent mortgage, or you could get stuck with a higher interest rate when you’re ready to take out your permanent mortgage. A construction-to-permanent loan locks you into a rate from the very beginning, and assures you’ll have your mortgage squared away when it’s time to move in.
Wintrust Mortgage can help find the perfect loan for your individual needs
Every borrower is unique. Wintrust Mortgage offers lending in all 50 states with a wide selection of options—many of which are exclusive to us or hard to find elsewhere—to help buyers find the right lending solutions based on their needs and goals. Many loans also include down payment assistance11 and other incentives for qualifying homebuyers including grants and tax credits.
A Wintrust Mortgage loan originator can help you find the best loan to meet your goals—we’re here to help find the right solution for your individual needs!
Get ahead of the pack
No matter how the market looks, it's important—especially for first-time buyers—to properly prepare for the homebuying journey. If conditions suddenly become more favorable, planning puts you ahead of the pack as other buyers enter a more competitive market.
The best way to get started is by becoming a PremierBuyer™.12 This offers a better idea of what you can afford and saves time while house hunting. Plus, having PremierBuyer™ status makes you more attractive to sellers by proving you’re both serious about a prospective purchase and more likely to be able to follow through. Wintrust Mortgage offers an online application to become a PremierBuyer™ that’s fast, easy, and secure. Click below to begin!
