2026 Housing Market Outlook

Arizona’s housing market in 2026 is transitioning into a more balanced and sustainable environment following several years of rapid change. Home price growth has moderated, inventory has improved, and buyers and sellers are adjusting to a “new normal” shaped by higher—but stabilizing—interest rates. 

 Statewide home values are projected to increase by approximately 2% to 4% in 2026, reflecting healthy but sustainable appreciation. Median home prices are expected to remain steady across most Arizona markets, reducing volatility while preserving long-term value.

Housing inventory has increased by roughly 10% to 15% year over year, giving buyers more options and easing competitive pressure. Homes are spending slightly more time on the market, allowing for negotiation and thoughtful decision-making.

Mortgage rates are forecasted to average between 5.75% and 6.5% throughout 2026. While higher than historic lows, these rates have stabilized, creating more predictable conditions for both buyers and sellers.

 Metro areas such as Phoenix, Scottsdale, Mesa, and surrounding suburbs are expected to outperform rural markets due to continued population growth, employment expansion, and controlled new construction. Demand remains strong, but market activity is more measured and strategic. 

 Overall, 2026 is expected to be defined by stability, opportunity, and informed decision-making. Buyers benefit from improved selection and pricing balance, while sellers who price accurately and prepare their homes effectively can still achieve strong results.