Zillow housing market forecast puts the 2026 recovery back on pause

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For mortgage professionals, Zillow’s latest outlook points to a softer finish for purchase volume even if existing-home sales remain slightly ahead for the full year.

The Zillow housing market forecast released by Zillow Research on September 18, 2026 says the housing recovery is “back on pause” for the remainder of the year, with existing-home sales projected to fall 3.5% in the fourth quarter. Zillow’s forecast still expects existing-home sales to end 2026 up 1.2% overall.

For loan officers and mortgage brokers, the message is pretty straightforward: the year may still be better than last year on paper, but the finish looks softer than many teams would like. Zillow’s title also says rents are up, which matters for renter conversion conversations, though the supplied material does not confirm how much rents rose or which rent index is being used.

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