Houses are staying on the market longer and often going for less than the asking price, even with the few interest rate cuts we’ve seen over the past few months. Home values are also predicted to stay relatively flat over the next few years, according to Zillow economists.
Orphe Divounguy, senior economist at Zillow, told WTOP this should be good news for potential homebuyers.
“Buyers facing more, slightly more affordable housing costs, with more available inventory on the for-sale market, gives them the best chance than they’ve had in a long time in 2026,” Divounguy said.
While nationwide home values are expected to rise by an estimated 1.2%, Zillow expects the D.C. area to see a 0.7% decline in home values in 2026.
Still sellers should make plenty of money selling their home.
“Most sellers are sitting on near record home equity. Home values appreciated roughly 31% during the pandemic. Most sellers in 2026 will do just fine,” Divounguy said.
The real estate market is far different from the one seen just four to five years ago, in the middle of the pandemic, when houses would be sold within hours of hitting the market, scoring payouts above the asking price.
As for how long houses are staying on the market now, Lydia Benson, vice president and associate broker at TTR Sotheby’s International Realty, said: “I think we’re up to 45 days now, which is just unbelievably long compared to the COVID times.”
Benson said that is a week longer than compared to last year, “and last year wasn’t fabulous either.”
Benson said the market in D.C. is all based on consumer confidence.
“People don’t know if they are going to have a job tomorrow,” she said. “They are both hesitant to buy, but they’re also hesitant to sell.”
After cuts to the federal workforce and a record-long federal government shutdown, confidence in the area is not particularly high.
This fall’s interest rate cuts should help begin to move buyers. With rate cuts announced Wednesday, Benson said it is already having an effect on purchasing; contracts are up 14% just from last week and up 3% from the same time last year.
“Houses are moving a little bit faster than they were a short time ago and certainly a year ago now. Perhaps that’s because people want to be in the house before the new year. Maybe it’s because of the interest rate cuts,” Benson said.
Divounguy said he predicts the rate cuts will offer more stability and hang in the low 6% range.
“Rates have been so volatile in the past couple years, that ought to help the housing market in 2026,” he said.
And for folks hoping to see mortgage rates similar to the 3% to 3.5% seen during the pandemic, Benson thinks they will be waiting for a long time.
“If you can get a decent 5.5% to 6% rate, it’s pretty good these days,” Benson said.
She echoed a popular real estate phrase, “you date the rate, but you marry the house,” adding that buyers can always refinance down the road if rates fall drastically.
For buyers in the market now, she said, “If there’s a house that really speaks to you, and it’s the one that you think you can see yourself living in for a long time, you should go for it, regardless, as long as you can afford it.”
Both Benson and Divounguy agreed that the market was not “dead” and instead a healthier and not as volatile market that has been seen over the past half decade.
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