February 27, 2026 Economic and Housing Market Update

February 27, 2026

Overview

Reports and articles referenced

Housing data for download

VIDEO TRANSCRIPT:

• Mortgage rates dropped below 6 percent for the first time since 2022. I’m Danielle Hale, Chief Economist at Realtor.com® Let’s discuss what this means for buyers and sellers plus how it could change a housing market that’s been grappling with a 4-year long high-rate era.
• First, the biggest news of the week is the fact that mortgage rates dipped to 5.98%, their lowest since September 2022. Lower rates today save buyers about one full monthly mortgage payment compared to last year – and that’s savings they’d get year after year! This won’t eliminate mortgage rate lock-in–70% of mortgage holders still have a rate below 5%, but this is going to make a difference for marginal buyers. When you might wonder? We’re not going to see the impact of these lower rates in February home sales, but I expect buyers to react and home sales to pick up as we move into March and April, so it will be a couple of months before we have that data.
• Looking back over the last 4 years of higher rates, we see that the housing market recalibrated in somewhat surprising ways. Instead of home prices dropping to reset affordability, we saw that movers in the high-rate environment were often buyers of necessity who were far less price-sensitive. Discretionary movers–who are often sellers and buyers–were sidelined, so home sales dropped to 30-year lows as inventory remained scarce and prices remained high even as affordability metrics pushed further beyond historic norms. Mortgage rates below 6% won’t immediately erase this legacy, but it will loosen the ties that bind some discretionary movers and start to thaw the frozen market. 
• One ongoing impact of the recent high rate environment is that today’s home shoppers remain far more likely to be shopping for a home in an area other than where they currently are. More than 3 in 5 online views to homes in the 100 largest markets came from a shopper who was out-of-market, compared with roughly half in 2019. While the out-of-market share has ebbed from its peak last year, it remains quite high. Sunbelt markets and New York-adjacent metros see the greatest overall out-of-market interest while the AI sector is an important thread among markets that have seen the biggest relative growth in out-of-market interest in the last 6 years.
• Insights from other housing data released this week confirmed that home price growth has indeed slowed nationwide driven by a wide variation in local-market trends. Case Shiller data showed that markets in the supply-constrained Northeast and Midwest like Chicago, New York, and Cleveland, saw home prices move higher while Sunbelt markets including Tampa (-2.9%), Denver (-2.1%), Phoenix (-1.5%), Dallas (-1.5%), and Miami (-1.5%) saw prices slip at the end of 2025.
• Looking at Realtor.com housing data on trends in the last week shows that home price softness continues, and active listings growth remains fairly moderate. Fortunately, new listings notched a second week of growth, and may pick up further as sellers join buyers in responding to recent mortgage rate relief. This is the stat I’m watching most closely in the weeks ahead.
• You can find it alongside all the details, including full reports and our housing data for download, at realtor.com/research.  You can also follow us on X (formerly twitter) for real time updates. And instagram for graphics.

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