Fannie Mae Sees Moderate Housing Market Growth Into 2026

Fannie Mae’s latest outlook calls for a gradually improving but still challenging housing market, with modest growth in home sales and prices through 2026 rather than a big rebound.​

Big picture

• Fannie Mae expects moderate national home price growth of roughly 2–3% a year in 2025 and 2026, a clear downshift from the stronger gains seen in 2024.​

• Total home sales (existing + new) are projected to grow, reaching roughly 5.1–5.5 million annualized by late 2026, up from under 5 million today but still below boom-era levels.​

• Mortgage rates are forecast to drift lower but remain relatively high by pre‑2020 standards, ending 2026 just under 6% on a 30‑year fixed.​

Key numbers in Fannie Mae’s outlook

• Home price growth: about 2.5–2.9% in 2025 and 1.3–2.8% in 2026, depending on the specific forecast vintage, indicating slow but positive appreciation.​

• Mortgage rates: around 6.4% at end‑2025 and 5.9–6.1% at end‑2026 in recent Economic & Housing Outlook updates.​

• Home sales: projections in recent releases point to new and existing home sales totaling about 4.7–4.8 million units in 2025 and around 5.1–5.2 million in 2026, a meaningful pickup but not a surge.​

• Single‑family mortgage originations: estimated around $1.9 trillion in 2025 and $2.3–$2.35 trillion in 2026 as slightly lower rates and more transactions support more lending activity.​

What “moderate growth” means for buyers and owners

• For buyers:

  • Affordability should improve slightly as mortgage rates ease and price growth slows, but high prices and mid‑5s to high‑5s rates still keep conditions tight.​

  • The outlook suggests more inventory and transaction volume, but not enough of a correction to “reset” prices in most areas.​

• For current owners:

  • Fannie Mae’s baseline view is continued equity growth, just at a slower pace than recent years, reducing the risk of a broad nationwide price decline.​

  • Many existing borrowers will still have rates well below market, so the lock‑in effect gradually eases but does not fully disappear by 2026.​

Regional and local variation

• Fannie Mae’s expert survey suggests some large metros may underperform or outperform the national average, so local outcomes can be stronger or weaker than the headline forecast.​

• Markets with persistent supply shortages and solid job growth are more likely to see stronger price gains, while areas with weaker economies or overbuilding risk softer conditions.​

If you share whether you’re more focused on buying, selling, or investing (and your price range), a more targeted read on what this 2026 outlook implies for you in Kihei and Hawaii specifically can be outlined.