The housing market forecast for March 2026 is showing a glacial improvement in home affordability. While the changes may not be drastic enough to impact buyers’ or sellers’ plans immediately, there are positive signs on the horizon.
Jim Breeze, senior vice president of PNC Bank, anticipates that March will be similar to last year, with a slight improvement. In 2025, PNC experienced a 47% increase in mortgage applications from January to April, with a significant uptick starting in March, up 38% compared to January 2025.
Planning ahead is crucial in the current market. Speaking with a mortgage advisor early on can reveal potential affordability options that may not be widely known. Down payment assistance programs are available that could make homeownership more attainable for many individuals.
Home affordability is on the rise, with a recent Zillow analysis showing an improvement of over $30,000 from a year ago. This increase is driven by rising incomes and falling mortgage rates, allowing a median-income household to afford a $331,483 home, the highest affordable price since March 2022.
Mortgage rates are becoming more favorable, dropping to levels not seen since September 2022. Rates are now under 6%, with 30-year fixed rates as low as 5.5%. If rates continue to stabilize or decrease further, both purchase and refinance activity are expected to increase.
Home price growth is slowing, with the lowest housing market appreciation seen since the recovery following the Great Recession. While buyers welcome this moderation in price gains, sellers may be hesitant to list their homes in hopes of better pricing conditions.
In 2025, nearly two-thirds of home buyers received a discount off the list price, with the typical buyer receiving a 7.9% price cut. This trend is expected to continue in 2026, with concessions from sellers likely for buyers.
While there is a balanced supply of homes for sale, new construction is struggling to keep up with demand. The home supply gap widened by over 4 million homes in 2025, indicating a need for more housing inventory to meet buyer needs.
Overall, the housing market in March 2026 is showing signs of improvement in affordability and market conditions. With favorable mortgage rates, slowing price growth, and concessions from sellers, now may be a good time for buyers to consider entering the market. Planning ahead and exploring all available options for assistance can help make homeownership a reality for many individuals.
