Housing Market Update: Rates, Inventory, and Your Next Move

Mortgage rates dipped below 6% for the first time in about three years, and then bounced back up about a quarter point once the conflict with Iran started. This was my March 2026 update on what to expect through the next few months.

Despite the news, the first thing I said is that affordability is the best we have seen in several years. Reports from Redfin and NAR showed that the affordability index, counting interest rates along with prices, was the best in a long time. Inventory was also higher. Homes listed between January and March were taking about 47 days on market, and about 34% of homes that sold took a price cut. Price cuts vary a lot by state. But overall there was more selection, and I expected inventory to keep climbing in April and May like it does every year.

Everyone wanted to know what the Fed would do at its March meeting. About a 94% chance, as of this video, that it would hold. That seems confusing when you look at the economy, because a jobs report a couple of weeks earlier showed a loss of 92,000 jobs when the expectation was for about 60,000 added. That kind of report usually tells the Fed to ease. The worry is oil. Prices spiked because of the conflict, and a lot of that is fear-based. We will not see it on store shelves for a while, but the fear alone is inflationary. So I did not think the Fed would do anything until we saw how that situation played out.

Some good news. Closed sales had ticked up to some of the best numbers in several years, in almost every state, and in some states it was close to pre-pandemic levels. Sellers still outnumbered buyers by about 600,000 units, so it is more of a buyer's market than a seller's market. But I also said I would not call it either one. Well-prepared homes that were clean, fixed up and priced from the comps were still getting multiple offers. It is not a bad market. It is just better than it has been the last couple of years.

Spring is the busiest time of year, and a lot of people pulled their homes off the market in the third and fourth quarter of 2025 to list now. I did tell people that some had stepped back because of the world news, and no one can predict how that ends. But I also said the midterms are coming, and I do not think anyone wants to head into them with high inflation and a war.

Most of what is happening with mortgage rates is reactionary. When things settle, the fundamentals point to lower rates and more selection for buyers. I think some of the best deals we will see since 2020 and 2021 show up this year.

If you are a first-time buyer in Redding, start with first-time buyer options or get your rate. MortgageOne is now licensed in 49 states.