How Lessons From 2025 Can Help You Prepare to Buy in 2026

2025 was a year where buyers had a little more room to breathe. There were more homes to choose from, moments when affordability improved and steady equity growth for people who already owned a home. The big lesson is that there were real opportunities for anyone who was ready.

As we look to 2026, rates will keep grabbing the headlines, but 2025 showed us that the right strategy can matter just as much as the rate itself.

1. Equity still grew, even in a slower year

Even with modest home price growth, many homeowners built meaningful equity throughout 2025. According to the national median sale price data from October 2025, home values increased by 1.3 percent year-over-year.

That percentage may seem small, but it has real financial impact. On a $450,000 home, that growth translates to roughly $5,850 in added value. This increase happens in addition to the equity a homeowner builds by making regular monthly payments. Buyers who waited missed a full year of progress they could have already started accumulating.

Takeaway for 2026:
If you are financially ready to buy, equity is one of the strongest arguments for entering the market sooner rather than later. Even slower appreciation can build real wealth over time. Because every situation is different, it is worthwhile to discuss timing with a loan officer who can help you understand the right moment for your budget and your long-term goals.

2. Affordability improved in key moments

Affordability reached its best point in more than two years in September 2025, according to ICE Mortgage Technology. This improvement lowered the principal and interest payment on an average priced home to about $2,148. Many buyers reduced that payment even further by using tools such as seller concessions, temporary buydowns, permanent buydowns or specialized loan programs.

There were several moments throughout the year when buyers who were prepared benefitted from improved affordability. Meanwhile, buyers who waited for a larger rate drop often missed the windows where costs were actually more manageable.

Takeaway for 2026:
Affordability is influenced by more than the headline rate of the day. Buyers who work with knowledgeable lenders and agents may uncover options that keep costs down even when rates do not fall. Understanding these strategies early gives you more opportunities to act when favorable moments appear.

3. Even small rate dips created more competition

Throughout 2025, mortgage applications increased quickly whenever rates moved down, even by a small amount. This is supported by data from the Mortgage Bankers Association, which also forecasts a 7.7 percent rise in purchase originations in 2026. Total purchase originations are expected to reach about 1.46 trillion dollars with approximately 5.8 million single-family loans.
(Link to MBA Forecast)

Increased demand during these dips created faster-moving markets and reduced negotiating power for buyers. Sellers were less likely to offer concessions, and buyers had to move more quickly to secure the home they wanted.

Takeaway for 2026:
If demand rises again in 2026, the market could become more competitive, and price pressure may increase. Buyers who prepare early, understand their numbers and are pre-approved ahead of time may be better positioned to act when the right opportunity appears. Preparation can offer an advantage before the next wave of buyers enters the market.

Strategy wins in 2026

Rates will continue to be a major part of the conversation, but they are only one part of the homebuying equation. In 2025, buyers who looked beyond the rate discovered meaningful wins: equity growth, improved affordability in key moments and strengthened negotiating power in a slower market.

The best approach for 2026 is to enter the year informed and prepared. Understanding your options, keeping an eye on local market trends and working with a loan officer who can help you evaluate real opportunities can make a significant difference. Buyers who start early often put themselves in the strongest position to take advantage of whatever the market offers next.

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