The rapid rise in interest rates that quickly siphoned away buying power heading into the spring homebuying season is going to sour home sales for the rest of the year, NAR’s chief economist told Inman this week.
Heading into 2026, the National Association of Realtors’ Lawrence Yun provided perhaps the rosiest outlook among housing economists who thought 2026 might turn a corner after three years of sales languishing around 4 million units.
Lawrence Yun
Yun’s had predicted a 14 percent jump in home sales this year. But now that’s no longer his expectation, he told Inman exclusively.
“That will be changed,” Yun said. “We are still working on it, but it’s going to be revised down just because the mortgage rate from the oil price shock has pushed up above what I anticipated it to be. We were at 6 percent mortgage rates maybe for five minutes before the war began.”
Yun has pointed to 6 percent rates as a critical threshold as buyers battle historically high housing prices. When rates jumped from a tick below 6 percent to 6.6 percent in the weeks following the start of the military campaign in Iran, it caused buyers to pull back.
Sales had already opened the year “sluggish,” Yun acknowledged. But rates were moving in buyers’ favor before the U.S. and Israel bombed Iran on Feb. 28.
“I was actually feeling good about the prospect [of higher sales], but now mortgage rates [are] at 6.5 percent, maybe my new projection will show slower growth this year,” Yun said. “I still believe that there will be some growth in overall home sales this year.”
NAR is now preparing to revise its home sales forecast downward as a result, with a new table expected to be published, possibly before Yun’s appearance at Inman On Tour Nashville later this month.
“The general direction is that we are not going to get the 14 percent increase in unit sales this year,” Yun said.
So far, there’s no indication that many buyers are preparing to accept mid-6 percent rates as a level they can work with.
That’s because with home prices lingering around record highs, mortgage rates are the primary way for buyers to gain any affordability edge, Yun said.
“If the mortgage rates do not decline, then it’s really not about their desirability, their willingness, their preference, but their financial capacity is not there at higher rates,” Yun said.
Buyers are slowly regaining some semblance of affordability as wages continue to rise faster than home prices, Yun noted.
Keep scrolling to view an interactive timeline of how mortgage rates have evolved in 2026.
