Here’s What to Know About Buying or Selling a Home in 2026

for the housing market, a lot of factors impacting things for buyers and sellers right now from the Federal Reserve's decision on interest rates yesterday to the war with a Rob NBC senior business correspondent Christine Romans watching all of it here to break down all of it for us Christine always good to see you. First let's just start with interest rate. Yeah, where are they now versus where they were say year ago, it's one of the most important variables in buying a home, how much you're going to finance this big probably the biggest purchase of your life for and rates are better right now than they were a year ago and so that's the good news you got about 6.3 6% on a 30 year fixed rate mortgage. That's what most people use that's better than a year ago, the 15 year you have a higher monthly payment, but you can pay it off more quickly. You have a lower mortgage rate to 5.9 7% now Craig a few weeks ago I was here telling you about mortgage rates that fell below 6% and how excited people were things have changed that war in Iran has caused some concerns about inflation, the Fed penciling in only one more rate cut for later this year. So the National Association of realtors expecting an average of about a 6% mortgage rate this year it will be higher and maybe lower than that from time to time. Better than last year, not as good as what we're seeing a few weeks ago, what about home prices and what about supply so home prices are still rising and as you know, I mean home prices have been nuts over the past few years they've risen very very quickly prices are up just a little bit versus last year so that home price increases are cooling. There are fewer homes selling above the listing price about 14% are selling above the listing price was more than 20% last year, what does that mean translation fewer extreme bidding wars this year and that's good for buyers inventory has increased a little bit we still need a lot more homes, there's a big story about after the great a recession, how we didn't build enough homes, but inventory is improving a little bit so all of these things are inching forward to being a positive for homebuyers this year and just one final thing here a lot of people have been frozen in their mortgages they didn't want to leave their house. The National Association of realtors tells us there are now more people with a 6% mortgage or higher as there are 3%. So that means people have said look I have to move I have to buy a house and I'm not going to let the mortgage rate hold me back. So if you're thinking of buying or selling right now is now the time to jump into the water. So for home buyers those better rates than last year and less competition that is a good combination for buyers, there's improved buying power Zillow says people can afford a little bit more of a home this year than last year. Prices are still high. So if you're the seller that means you're going to walk away with a bucket of money if you bought your house 5, 6, 7, 8 years ago. Now the problem is you've got to live in the bucket. You've got to go by another house so for sellers be careful there. But there are some reasons for both buyers and sellers that this year is a little bit better than last year, what are some some rules of thumb that folks should keep in mind if they're thinking about buying or sell. So the most important thing in my book is don't get a house you can't afford if you need to rent for another year or 2, then you should do that try to build a down payment funds, you know put it in a high yield savings account. 20% is the rule of thumb a 20% down payment, not everybody can do that there are 3% down payments that you can get if you look at your bank or your credit union or state local and federal programs if you qualify you want to consider about a 28% of your monthly income that's what you spend on housing that's not just your your mortgage that's also your insurance and you're up to that 28% rule of thumb people scream at me they say most most of coach you can't do that and I realize that but just be aware that for financial flexibility that's what you want to do there and if you are flexible where you can live. Some of the best markets for buyers include Indianapolis Atlanta, Charlotte cities, you know these are some of the places that are the best places to live and buy right now, but sometimes you're not flexible you have to buy a house most people are because you're going to have to live near Grandma and Grandpa for the free child care or you're you know intent, you know there are other things there are other reasons the schools you move for a job there sometimes just the mortgage rate or just the home price is not the driving factor in housing really quickly before let's get out of here arms is adjustable rate mortgages are they as popular as they used to be. They're getting more popular again and the reason why is the feeling is eventually interest rates will start to come down got so in a declining interest rate environment, an arm is an adjustable rate mortgage, which means you agree right now for a certain period of time to pay X percent interest, but it will adjust with the market now the risk is if there's some big inflation surge if the war in Iran is a real you know problem for for a long time and interest rates actually start to rise then you get caught then your housing prices rise so that's why the 30 year fix is so popular for some people there are no surprises in a 30 year fixed rate mortgage, Christine Romans you always bring the goods, thank you to see if you can see.