A glacial improvement in home affordability is occurring. While it can be statistically proven, it may not feel dramatic enough to change many buyers’ or sellers’ plans just yet. Here is the housing market forecast for March 2026.

Jim Breeze, senior vice president of PNC Bank, expects March to be similar to last year, and perhaps “a little improved.”

Last year, PNC saw a 47% increase in mortgage applications from January to April, with the initial uptick beginning in March (up 38% compared to January 2025).

“That’s really typical for the mortgage industry in totality,” Breeze told Yahoo Finance. “November, December, and January tend to be slower. Then you start getting into the time frame when people are thinking about actually making that move. So they start looking to get ready for those summer months.”

Breeze noted that planning ahead is key. Talking to a mortgage advisor well before you’re house hunting can uncover possible affordability levers that can be pulled.

“There’s a lot of down payment assistance programs out there that people may not know about. If they talk to somebody, that dream of affordability might have just increased, because now there’s some other mechanism that’s going to help get you into that new home,” he said.

Read more: Down payment assistance: How it works and how to qualify

Home affordability is gradually increasing. A new Zillow analysis found that affordability has improved by more than $30,000 from one year ago, driven by rising incomes and falling mortgage rates. That means a median-income household can now afford a $331,483 home. Zillow said that’s the highest affordable price since March 2022.

Here’s a closer look at the factors impacting home affordability in March.

Mortgage rates are slowly becoming more favorable, falling to levels not seen since September 2022.

Mortgage rates began a slow slide downward in mid-November. Now, more sources are reporting loan rates under 6%. Yahoo Finance’s weekly survey of lender rates shows 30-year fixed rates as low as 5.5% — rates were topping 7% a little more than one year ago.

If rates remain calm in March or crawl even lower, purchase and refinance activity will continue to grow.

“The stabilization of mortgage rates near 6% this spring marks a notable turning point where, for the first time since the post-pandemic spike, both the psychological barrier and the numerical threshold of the 5% range have finally been reached,” Realtor.com economist Jiayi Xu said in a release. “A lower rate could possibly bring more homeowners who were previously ‘locked in’ to finally enter back into the market.”

Home price growth is slowing, with the lowest housing market appreciation since the recovery began following the Great Recession, according to the S&P Cotality Case-Shiller Index.

That can be a double-edged sword: Buyers welcome the moderation of price gains, but home sellers may take their listings off the market, hoping for more favorable pricing conditions.

“2025 marked the end of an unprecedented period of price growth,” said Thom Malone, principal economist at Cotality. “Following a five-year run of gains — including the 19% peak in 2021 — growth fell to a mere 1.3% in 2025. The market is now waiting for the broader economy to catch up.”

Malone expects only nominal price growth in 2026.

Read more: This map shows the median home price by state

Nearly two-thirds of home buyers in 2025 (62.2%) received a discount off the list price. Redfin’s analysis of MLS listings found the typical buyer received a 7.9% price cut — the largest since 2012.

“Homebuyers in 2026 shouldn’t write off homes that are slightly above their budget because there’s a good chance they’ll get some sort of concession from the seller, be it a price cut, money toward closing costs, or funds for repairs,” Redfin senior economist Asad Khan reported.

Redfin reported that through February 22, 2025, there was a 5.1-month supply of homes for sale. “4 to 5 months of supply is considered balanced, with a lower number indicating seller’s market conditions,” Redfin noted.

However, Realtor.com’s latest Housing Supply Gap Report found that new construction could not keep up with demand, and the home supply gap widened by over 4 million homes in 2025.

“Even when annual construction and household formation are roughly balanced, the market is still digging out from more than a decade of underbuilding,” Danielle Hale, chief economist at Realtor.com, said in a release.

New listings are 80,595, down 2.8% year-over-year, according to Redfin.

Redfin reports that the median days on the market is 67, an increase of eight days, and the longest in nearly seven years.

The Mortgage Bankers Association says it is getting incrementally easier to qualify for a mortgage, based on its credit availability index. The measure of credit availability bottomed in November 2023, and has been generally increasing since — a sign of loosening credit.

“The beginning of the year is typically when lenders start to position themselves for the spring homebuying pick up, and recent dips in mortgage rates have provided windows of refinance opportunities, including refinances into ARM loans,” Joel Kan, MBA’s deputy chief economist, said in a report.