Over the last several years, I’ve kept a close eye on national — and local — home values. My career as a real-estate reporter is the main reason for doing so. But I’m also personally attached to property value trends.I was obsessed with home values when buying my first home in 2022, because I needed to know which houses I could afford. Now I’m a homeowner, but I know this isn’t my forever home. I hope to sell in the next few years, and I’m curious what my house could be worth when that time comes.So, when a well-known real estate technology company like Zillow publishes data about home value predictions, I can’t click on the link fast enough.And the company recently published its Zillow Home Value and Homes Sales Forecast for April 2026.The projections include insights about what’s in store for housing values throughout 2026. Zillow also dives into expectations for existing home sales, data that affects home sellers and buyers alike.Zillow predicts modest home value increasesNationally, Zillow expects the annual typical home value to increase by just 0.3% by the end of 2026. The company predicts that there will be more inventory throughout the year.Home values typically increase when demand exceeds supply, because homebuyers have to compete for available homes. This may lead would-be buyers to offer more than the asking price and even get into bidding wars.Related: Fannie Mae predicts shift in mortgage rates, home pricesOn the flip side, when there are plenty of houses on the market for buyers to choose from, sellers have less bargaining power in real estate transactions. This typically means their properties sell for less.Inventory growth isn’t the only factor affecting home sales, though. The number of buyers who can actuallyafford a house will also impact the 2026 housing market.High mortgage costs could lead to fewer home salesIn Zillow’s March forecast, it predicted a 3.4% year-over-year increase in existing-home sales by the end of 2026. However, the projected number has dropped to just 0.5% now.Zillow analysts expect high borrowing costs to take a toll on homebuyers. If fewer people can afford a mortgage because of higher interest rates, fewer will be able to buy houses, further reducing demand.”Upward revisions to mortgage rate expectations, driven by persistent inflation concerns, are likely to keep borrowing costs elevated,” reads the report. “This is expected to weigh on buyer demand and limit overall transaction activity.”More on real estate and the housing market:Experts send strong message about decreasing mortgage ratesRedfin sees shift in home prices, housing marketZillow sends blunt message about affordability, housing marketData from the National Association of Realtors (NAR) showed that annual existing-home sales decreased by 3.6% in March. “March home sales remained sluggish and below last year’s pace. Lower consumer confidence and softer job growth continue to hold back buyers,” said NAR chief economist Dr. Lawrence Yun.Although Zillow expects inventory to grow throughout 2026, relatively high mortgage rates could keep potential homebuyers out of the game this year.What Zillow’s 2026 predictions mean for AmericansHome values and existing-home sales impact pretty much everyone in the housing market, whether you’re a homebuyer, seller, or owner holding onto your property.Mortgage rates are still well above 6%, making it less affordable to take out a mortgage to buy a home. However, Zillow expects home values to be relatively stagnant this year, making it more affordable to buy a house. This is a mixed bag for buyers. If you can afford a home at today’s mortgage rates, then it could be a good year to buy.Steady home values make it tough for homeowners who want to take out a home equity loan or a home equity line of credit (HELOC). The lower your property value, the less you’ll qualify to borrow with these second mortgages.Stagnant home values can also be disappointing for sellers, because you might not get as much money for your house as you’d originally hoped for.Because buying will probably be less affordable, sellers should be prepared for their houses to stay on the market longer. Talk to your real estate agent about what type of negotiations you’d be willing to make with a buyer to sell your home faster.Related: Dave Ramsey sends strong message on housing market
Zillow predicts change in home values, housing market
