The U.S. housing market is showing clear signs of a rebalance and gradual rebound after several years of headwinds. Leading economists from the National Association of REALTORS® (NAR), National Association of Home Builders (NAHB), and realtor.com® point to improving affordability, rising inventory, modestly lower mortgage rates, and fading “lock-in” effects as key drivers for the year ahead. Nationally, NAR projects a solid 14% increase in existing-home sales, home price appreciation of 2-4%, and a continued easing of supply constraints.

Here in Central Florida—particularly in desirable suburban communities like Windermere, Winter Garden, and the broader Orlando metro area—these national trends intersect with strong local fundamentals: population growth fueled by job opportunities, tourism recovery, family-friendly appeal, and a mix of luxury lakefront estates and family-oriented neighborhoods. With 30-year fixed mortgage rates stabilizing around 6.16% (Freddie Mac, January 8, 2026) and some averages dipping toward 5.87-5.99% (Zillow and others), affordability is improving, potentially spurring more activity in these sought-after markets.

A Reawakening in Home Sales – Lawrence Yun, NAR Chief Economist

Lawrence Yun forecasts a 14% nationwide rise in existing-home sales for 2026, supported by inventory growth (up ~20% year-over-year) and diminishing lock-in effects from ultra-low-rate mortgages. Life events—job changes, family growth, retirements—are increasingly motivating homeowners to list.

• Home prices expected to rise 2-3%, roughly in line with inflation, while wage growth outpaces both—boosting real purchasing power.

• Inventory improvements give buyers more options and reduce bidding wars; the market remains slightly undersupplied but significantly more balanced.

• Homeownership demand remains resilient among renters, with better conditions (lower rates, more listings) creating a more favorable environment in 2026.

Central Florida context: In markets like Windermere (known for luxury lakefront properties), Winter Garden (charming historic downtown and family appeal), and Orlando metro overall, increased listings could bring more inventory to high-demand areas, potentially shortening days on market for well-priced homes.

Supply-Side Signals – Robert Dietz, NAHB Chief Economist

Dietz anticipates modest supply-side gains, with 1% increases in single-family starts and new-home sales, helped by lower Fed funds rates reducing construction financing costs. However, a long-standing structural housing shortage continues to limit affordability.

• New vs. resale pricing dynamic: In some periods, median resale homes have exceeded new-build prices due to builder incentives and location factors.

• Zoning and land-use policies remain a major constraint on medium-density development (e.g., townhomes), which could help affordability if reformed.

• Geographic shifts: Previously overheated Sun Belt markets (including parts of Florida) show signs of moderation due to earlier overbuilding and sustained higher rates, while Midwest markets gain momentum.

Central Florida implications: Orlando-area new construction continues to support growth, particularly in family-oriented suburbs like Winter Garden and Windermere, where demand for larger homes and master-planned communities remains strong.

Housing Affordability Improves – Danielle Hale, realtor.com® Chief Economist

Hale identifies affordability improvement as the single biggest positive trend for 2026. Monthly mortgage payments could decline for the first time since 2020, as lower rates offset modest price growth (~2%) and incomes rise.

• Market balance: The most balanced conditions in nearly a decade; sellers are showing more flexibility (higher listing pull-off rates at ~6%), while buyers gain negotiating power.

• Regional variation: Markets with more construction (often in the South) are more balanced; inventory-constrained regions see continued price pressure.

• Policy outlook: A slower pace of policy changes in 2026 should help all parties plan with greater certainty.

Local angle: In Central Florida’s desirable suburbs, improved affordability could attract more relocating families and professionals to Windermere’s upscale lake communities and Winter Garden’s walkable, family-centric neighborhoods.

Demographic Trends Reshape the Market – Jessica Lautz, NAR Deputy Chief Economist

Shifting demographics continue to influence buyer profiles: rising numbers of single female buyers, gradual return of first-time buyers, and baby boomers leveraging substantial equity to make lifestyle-driven moves.

• Smaller households are increasingly common (fewer buyers with young children, shrinking average home sizes).

• All-cash purchases remain prevalent due to accumulated homeowner wealth, though mortgage applications are trending upward.

Central Florida relevance: Orlando’s family-friendly appeal continues to draw younger households, while boomers seek lower-maintenance luxury properties in Windermere and Winter Garden—often trading up or downsizing within the region.

All Eyes on Mortgage Rates – Nadia Evangelou, NAR Senior Economist

A 1 percentage-point drop in rates (e.g., from 7% to 6%) can expand the qualified buyer pool by approximately 5.5 million households—including 1.6 million potential first-time buyers—potentially adding ~500,000 sales nationally.

• Rates remain a critical lever after their sharp rise added over $1,000/month to typical payments compared to pre-pandemic levels.

• Inventory must rise in tandem to absorb returning demand; middle-income buyers currently can afford only ~21% of available listings (down from ~50% pre-pandemic).

Current reality: Mid-January 2026 rates near 6% are already creating opportunities, particularly in markets with growing inventory like parts of the Orlando metro.

Key Takeaways for Central Florida in 2026

The consensus among economists is cautiously optimistic: 2026 brings a healthier, more balanced market with meaningful affordability gains, more choices for buyers, and opportunities for sellers who price realistically. Challenges—such as lingering supply shortages and regional differences—persist, but the overall trajectory is positive.

For buyers in Windermere, Winter Garden, and Orlando: Improved conditions make this an excellent time to secure a home, especially if you’ve been waiting for better affordability.

For sellers: More inventory means pricing strategically and highlighting unique features (lake views, proximity to downtown Winter Garden, or Orlando access) will be key to standing out.

If you’re considering a move in Windermere, Winter Garden, Orlando, or elsewhere in Central Florida, reach out—I’d be happy to discuss how these national trends are playing out locally and help you navigate the 2026 market.