Zillow just released its Housing Market Predictions report for 2026, which examines how the market will shape up throughout the year for buyers, sellers, owners, and renters. Fortunately, good news is in store for all of the above.

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Sellers Will Get a Value Boost This Year

Despite home values rising only modestly in 2025, the new year should bring value gains for homeowners across the United States. Zillow predicts home values will grow about 1.2% over the next year, a welcome data point for current owners. Zillow also says that mortgage costs are likely to be a bit lower. 

If you’re thinking of selling your home, 2026 is clearly a good year to do so, according to Zillow. Besides seeing the value of your home rise, total home sales will increase by just over 4% in the new year. Now that mortgage rates are slightly lower and homes are becoming more affordable, prospective buyers are feeling the itch to make the move on a new house. 

You’ll also be a lucky seller in 2026 if your home is equipped with what Zillow calls "inflation-savvy home features." Value boosters like electric vehicle charging stations, energy-efficient appliances, and zero-energy-ready dwellings will continue to surge in popularity throughout the next year as buyers seek out ways to save time and money in their new homes. 

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Mortgage Rates and New Construction Homes

While mortgage costs are low, mortgage rates are still likely to remain above 6%, says Zillow. Mortgage rates are never easy to predict accurately, but Zillow’s predictions typically stand firm. This would still align with an overall decrease in mortgage rates since 2024, though perhaps not the steep drop everyone is hoping for. 

Prospective buyers should also be aware that new construction homes will drop significantly in 2026, according to Zillow—the platform predicts this will be the worst year for new builds since 2019, mainly because so many are already waiting to be sold.

If you’re considering a new build for yourself in the new year, Zillow says you might see builders offering rate buy-downs to sell off their inventory—a bonus for new home buyers.

Family Rental Demands Are Changing

So, what if you’re a renter? It’s likely to be a good year for you, too, according to Zillow. The platform expects rental affordability to continue improving throughout 2026; income is increasing faster than rent prices, so rent will take up a smaller share of most renters’ income.

Multifamily rents are expected to rise 0.3% in 2026, while single-family rentals are expected to rise 2.3%. The only place where you won’t benefit from slow rental rate increases is New York City.

If you’re a renter with kids, be aware that what Zillow has coined ‘Kidfluence’ will shift demand in the current rental market. 37% of renters today have a minor child with them, which means that you may have more competition if you’re looking to rent a family-friendly home or apartment. One benefit, however, is that more rentals may begin to offer family-friendly amenities and layouts.