Housing Research Brief

Borrowing costs weigh on demand. Because mortgage rates are closely tied to monetary policy expectations, prediction markets are now pricing in nearly even odds that the 30-year fixed rate surpasses 6.8 percent before year-end, with a roughly one-in-four chance it reaches 7.0 percent. Should borrowing costs continue to rise, affordability pressures will intensify, weighing on home sales at a time when market conditions are already softening. Seasonally adjusted existing home sales in April remained nearly 25 percent below the monthly average recorded between 2015 and 2019, while the median existing home sale price has declined nearly 2 percent through the first four months of 2026.