If you’ve been asking yourself whether now is the right time to buy a house, you’re not alone. The housing market has been shifting fast over the past few years, and with mortgage rates, prices, and inventory all on the move, it can be tricky to know what’s smart — and what’s not.
Let’s break down what’s really happening with home prices, mortgage rates, inventory levels, and the overall economy so you can make the best decision for you and your family. I’ll cover both the big national trends and what this means here in New Jersey, where inventory is still tight and prices are holding strong.
The Market Backdrop: Slow but Changing
Over the past couple of years, real estate has stayed in a slower gear — fewer sales, fewer new listings, and prices that seem to only want to climb.
2025 went down as one of the slowest years for home sales in the past decade, and while 2026 is picking up slightly, many of those same trends are still hanging around. The biggest difference? Mortgage rates have finally eased off their highs, and that shift is giving today’s buyers a chance to reenter the market.
So… Is It a Good Time to Buy?
That depends — mainly on you.
If your finances are solid, your job is stable, and you’re planning to stay in your next home for a while, this could actually be a very good moment to buy. Market factors like rates and prices matter, of course, but your personal situation — your budget, goals, and timeline — carries even more weight.
Think of the market as the backdrop — you’re the main character in this story.
What Economists Are Saying About Housing
Top housing economists, including Redfin’s chief economist, agree: if you can comfortably afford it, this can be a smart time to purchase.
Yes, prices are high — and that’s scaring off many casual buyers — but that also means serious buyers often have more leverage in negotiations. The key is to walk in with your eyes open, solid finances, and a clear sense of your local market, not just what the national headlines are saying.
Home Prices: High and Still Creeping Up
Nationally, the median home price is in the low-to-mid $400,000s, about 30% higher than five years ago. Prices have posted steady year-over-year gains for more than two years, and while growth is slowing, most experts don’t expect a big price drop ahead.
Here in New Jersey, especially in desirable commuter towns with top-rated schools, prices have stayed firm because inventory remains limited and demand is steady. Simply put: there are still more buyers than available homes.
Why Prices Haven’t Dropped Much
In some areas, affordability challenges have caused buyers to pause, which should create more inventory. But many sellers have reacted by pulling homes off the market instead of lowering prices, keeping prices higher overall.
Forecasts for 2026 point to slower growth, not big declines — so waiting for a “huge discount” might not be a realistic strategy.
Mortgage Rates: Finally Some Good News
Here’s where buyers are finally catching a break. Rates have dropped from over 7% last year to roughly 6% or slightly lower this winter. That’s a meaningful difference for monthly budgets.
Experts expect rates to hover between the high‑5% to low‑6% range through much of 2026 — not pandemic‑era lows, but much friendlier for buyers.
Even a small drop in rate can save hundreds of dollars per month or tens of thousands over the life of the loan. That’s why so many buyers are watching rates closely right now: every dip increases their purchasing power.
Where Buyers Hold the Advantage
This is one of the most balanced markets we’ve seen in years. In many parts of the country — especially the South — buyers are holding more of the cards thanks to higher inventory levels. Negotiating for seller credits, price reductions, or inspection repairs is once again common.
However, in many New Jersey towns, inventory remains tight. Sellers here still have more leverage, and well‑maintained, well‑located homes continue to move quickly.
Inventory: More Nationwide, Still Tight Locally
Across the U.S., there are about 1.7 million homes for sale — more than in recent years, but still low compared to long-term averages. Florida and Texas are leading with inventory growth, while supply remains tight across much of the Northeast.
In New Jersey, local markets remain structurally supply‑constrained — meaning people stay in their homes longer, new home construction can’t keep up, and limited land means fewer options. That continues to support prices even as national trends cool.
Why Some Buyers Are Still Hesitant
Even with lower rates and more listings, many buyers remain on the sidelines. Housing costs — from property taxes to insurance — are still high.
First-time buyers today make up a historically small share of the market, with many relying on family assistance or doubling up on living arrangements just to make ends meet.
Inflation, the Economy, and What Could Change
Inflation continues to hover above the Federal Reserve’s target, and any uptick could force rates higher again. For that reason, some buyers feel more confident locking in now at stable rates rather than waiting and hoping for a lower one later.
How to Buy Smart in 2026
If you’re thinking about buying this year, here’s what matters most:
- Stick to a realistic budget. Don’t stretch to the top of your pre‑approval.
- Negotiate smart. Ask about credits, closing help, and repairs — they’re common again.
- Shop your mortgage. Compare lenders and ask about “float down” or refinance options if rates fall later.
Buying and Selling at the Same Time
If you already own a home, selling before you buy can simplify the process — you’ll know exactly what you net and what you can afford next.
Buying first can still work with a strong pre‑approval or bridge loan, but that’s best for those with high income stability and strong risk tolerance.
Your Personal Readiness Checklist
Before you make a move:
- Review your savings, credit, and debt.
- Compare owning vs. renting costs in your area.
- Budget for taxes, insurance, and maintenance.
- Make sure your job and lifestyle align with homeownership.
Also consider local climate risks — especially with rising insurance costs in flood or storm‑prone areas — and think honestly about how much maintenance you really want.
The Bottom Line
If your finances are strong and you’re ready to commit to a home, 2026 can absolutely be a good time to buy. Rates are lower than last year, inventory is improving, and buyers finally have some leverage again.
But if your job feels shaky or your savings need work, it’s perfectly okay to wait, keep preparing, and watch for the right opportunity.
Thinking about buying a home this year? I’m always happy to help you walk through your numbers, explore your options, and see what fits your budget and lifestyle here in Monmouth County and beyond.
If you found this helpful, connect with me anytime — and if you caught this topic on YouTube, don’t forget to like, subscribe, and drop your questions in the comments for future videos!
💬 Let’s Make Your Real Estate Goals Happen
Hi, I’m Cori Dunphy, your trusted Monmouth County real estate expert and lifelong New Jersey resident. With over 24 years of helping buyers and sellers across the Garden State, I bring deep local knowledge, sharp market insight, and a lot of heart to every client experience.
Whether buying your first home, upsizing, downsizing, or simply exploring your options, I’m here to guide you honestly, clearly, and confidently — every step of the way.
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