Zillow Market Report Points to Spring Rebound

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Zillow, Seattle, said its February Market Report suggests the market is starting to regain confidence.

“The housing market is perking up as spring approaches, possibly foreshadowing a more active year for transactions after three low-volume years,” Zillow Group Chief Economist Mischa Fisher said.

Home values rose for the first time in seven months in February and existing home sales increased 1.8% from a year ago. “The improvement in existing home sales in February suggests January’s weaker figures were likely influenced by severe winter weather, while improved affordability aligns with Zillow’s forecast for increased activity this year,” Fisher said. “Lower mortgage rates have helped improve buying power by about $30,000 for a median-income household over the past year, while the typical mortgage payment is down 7.7% from a year ago, excluding taxes and insurance.”

The report said these results provide a “glimmer of hope” that housing market activity has turned a corner after bouncing along the bottom since 2023. “Zillow expects 2026 to be the first year of meaningful sales growth since 2021. A sustained dip for mortgage rates below 6% could provide a psychological boost that prompts more buyers and sellers to return to the market,” the report said.

New listings fell 3% from a year earlier in February, as winter storms may have continued to disrupt activity. “This will be an important metric to watch in the months ahead to track how many fresh options will be available to buyers benefiting from improved affordability,” Fisher added.