My 2026 Housing Forecast: Why Homes Still Feel Unaffordable
Prices are flat. Rates are lower. Affordability is still broken.Here’s my 2026 housing forecast, breaking down prices, taxes, insurance, and the markets that actually make sense heading into next year.
2026 Housing Affordability?
Home prices have gone sideways. Mortgage rates are down from their highs. Yet housing still feels unaffordable. This is a data-driven breakdown of why — and what it means for 2026.
Core Insight: Housing affordability didn’t break because prices kept rising — it broke because the total cost of owning a home kept increasing.
Below is the FHFA All-Transactions House Price Index for the U.S. and the year-over-year change using Q4-to-Q4 for 2021–2024, and Q3-to-Q3 for 2025 (latest available quarter).
Year
Reference
FHFA HPI (Index)
YoY Change
2021
Q4
556.35
18.0%
2022
Q4
617.44
11.0%
2023
Q4
651.14
5.5%
2024
Q4
687.63
5.6%
2025
Q3 (latest)
706.04
3.2%
Property Taxes: Highest vs Lowest
Top 5 Highest Property Tax States High Cost
Rank
State
Effective Property Tax Rate
1
New Jersey
2.26%
2
Illinois
2.08%
3
New Hampshire
1.99%
4
Vermont
1.83%
5
Connecticut
1.79%
Top 5 Lowest Property Tax States Low Cost
Rank
State
Effective Property Tax Rate
1
Hawaii
0.27%
2
Alabama
0.41%
3
Colorado
0.49%
4
Louisiana
0.55%
5
Delaware
0.57%
Homeowners Insurance: Highest vs Lowest
Top 5 Highest Insurance States Risk Zones
Rank
State
Avg Annual Premium
1
Florida
$11,000+
2
Louisiana
$4,100
3
Texas
$3,900
4
California
$2,800
5
Oklahoma
$2,600
Top 5 Lowest Insurance States Stable
Rank
State
Avg Annual Premium
1
Vermont
$780
2
New Hampshire
$820
3
Utah
$850
4
Idaho
$900
5
Oregon
$950
Most Affordable Housing Markets for 2026
Added context: to show what price growth has looked like in these “affordable” metros, the last column shows FHFA All-Transactions HPI change from 2021Q4 → 2025Q3.
Rank
Metro
% Income Needed
Home Price Change Since 2021Q4
1
Cleveland, OH
22%
+33.9%
2
St. Louis, MO
23%
+30.0%
3
Detroit, MI
24%
+30.2%
4
Pittsburgh, PA
25%
+25.0%
5
Indianapolis, IN
26%
+29.6%
6
Grand Rapids, MI
27%
+34.1%
7
Columbus, OH
28%
+32.4%
8
Cincinnati, OH
29%
+35.0%
9
Buffalo, NY
30%
+35.6%
10
Rochester, NY
30%
+44.7%
Least Affordable Housing Markets for 2026
Same added context: the last column shows FHFA All-Transactions HPI change from 2021Q4 → 2025Q3.
Rank
Metro
% Income Needed
Home Price Change Since 2021Q4
1
San Jose, CA
68%
+20.8%
2
San Francisco, CA
63%
+14.4%
3
Los Angeles, CA
56%
+20.8%
4
San Diego, CA
55%
+25.9%
5
Honolulu, HI
54%
+19.1%
6
Miami, FL
51%
+46.0%
7
Naples, FL
50%
+23.8%
8
New York City, NY
49%
+31.0%
9
Boston, MA
47%
+27.6%
10
Orange County, CA
46%
+33.7%
Correlation Insight: Least affordable markets are not “just expensive.” They typically stack: high prices + high taxes and/or rapidly rising insurance. Meanwhile, many “affordable” markets can still appreciate strongly — because affordability attracts demand.
Data Method (for transparency): National and metro home price changes use the FHFA All-Transactions House Price Index. National YoY uses Q4-to-Q4 for 2021–2024 and Q3-to-Q3 for 2025 (latest available quarter).
