Housing will face a ‘significant headwind’ in 2026 

Though housing affordability is expected to improve in the year ahead, a new survey suggests that concerns about the economy could still meaningfully impact homebuying demand in 2026.

Economic anxiety is widespread: The recent consumer survey from Bright MLS found that economic anxiety is broadly felt across demographic and income groups throughout the U.S., with renters, lower-income households and millennials experiencing the most stress.

The survey, which was conducted among more than 3,300 adults in December, found that over 80% of renters were "somewhat" or "very" worried about needing to slash essential spending, a concern shared among 73.2% of homeowners.

The "K-shaped economy" that marked 2025 — in which the real estate market was more active for buyers in higher income brackets while sales stayed slow for most home price points — may explain why economic uncertainty is more pronounced among those with lower earnings than prospective buyers with stable financial footing, Bright MLS economists noted.

Job worries weigh heavily: Labor market concerns, which factor into homebuying decisions, are similarly high. Nearly two-thirds of survey respondents said they were "somewhat" or "very" worried about possible cuts at their workplace in the next year — and over 60% were worried about losing their own job or having their hours reduced.

Older millennials are seeing the highest levels of economic concerns, according to Bright MLS Chief Economist Lisa Sturtevant, which may be because of the other economic shocks they've endured over the past 20 years.

"They entered the workforce during the Great Recession, were hit again by the COVID-19 pandemic during key life stages, and now face renewed economic uncertainty just as many are trying to buy their first home or move up to a larger one," Sturtevant said.

Will lower mortgage rates help? Even if mortgage rates continue to trend downward, widespread economic concerns will create a "significant headwind" for the homebuying market, Sturtevant said.

"When people feel uncertain about their jobs, their debt or their ability to cover basic expenses, they are far less likely to make big financial decisions like buying or selling a home," she added.

Market activity still expected to increase: But pent-up demand — particularly among those who have been waiting for mortgage rates to drop — will lead to more activity within the housing market.

Even so, market activity overall will remain muted, Sturtevant said, meaning that 2026 will likely bring "a year of cautious progress rather than a full housing market rebound."