Mary’s Market Watch: Q1 2026

In A Nutshell

In today’s unpredictable environment, the real estate market seems to be slowly rebalancing

and becoming more stable. This more moderately paced trend is due to slightly lower mortgage rates, more housing inventory, and slowing price growth. An increase in real estate sales is thus forecasted for 2026, both nationally and locally. This boost in sales would be a welcome change to many sellers and buyers alike who have stayed on the sidelines while waiting for more favorable market conditions. Other real estate sectors are also experiencing greater stability, a marked change from the feast-or-famine rollercoaster ride years ago. 

In Other News

• On April 30, 2026, the average mortgage with a 30-year fixed rate was 6.45% according to Mortgage News Daily. While historically low, this mortgage rate is considered high compared to mortgage rates less than 5.00%, which were common between 2010 and 2022.

• Home prices are historically very high, which benefits sellers but negatively impacts housing affordability.

• DFW was named as the top leader for corporate headquarters relations in 2025.

• The FIFA World Cup will take place at the AT&T Stadium in Arlington, Texas, from June 14 to July 14, 2026.

A Deep Dive into the Data

U.S. Real Estate Market

During early 2026, the U.S. economy grew moderately. The unemployment rate slightly increased to 4.4% from 4.3% in December 2025 as mergers became more frequent and a number of corporations trimmed their workforce. Driven by rising energy costs from the turmoil in the Middle East and the impact of tariffs, inflation jumped to 3.3% in March from 2.4% in February. Spending is starting to moderate slightly as consumers become more cautious amidst the changing political winds. 

These national trends are contributing to the fragmentation that seems to characterize the real estate market these days. Metro areas where inventory remains high, including Sunbelt cities like Miami, Nashville, Charlotte, and Austin, are a buyer’s market. In contrast, cities where new construction lagged are still firmly a seller’s market, e.g.,  Newark, N.J. and Milwaukee. There are also a number of cities including New York City and San Francisco that are experiencing a balanced market. Overall, the current market conditions are characterized by rising inventory, moderate price growth (roughly 2% - 3%), and a shift toward a more balanced, but still challenging, buyer environment. 

Although inventory is rising, it is still comparatively limited nationally and poses a constraint to sales. As a result, existing-home sales in March were lackluster, decreasing from last year’s sales. Additionally, the median home price grew to a new record high in March. 

• Interest Rates. The Federal Reserve Bank left interest rates unchanged at their last meeting, ending on April 29. Jerome Powell’s term as Federal Reserve Chair is due to expire on May 15. Kevin Warsh, who is a former Federal Reserve Governor, has been appointed by President Donald Trump and recently attended a Senate Confirmation Hearing for his appointment. If Warsh were to become the next Chair of the Federal Reserve Bank, it is expected that Powell’s replacement would work with the other members of the Federal Open Market Committee to lower interest rates, which, in turn, would lower mortgage rates over time.

• Mortgage Rates. 6.18% was the average 30-year fixed-rate mortgage in March, according to Freddie Mac, up from 6.05% in February and down from 6.65% one year ago. The changing of the guard at the Federal Reserve Bank is anticipated to spur lower rates, which would be a boon to buyer demand.

• Home Sales, Price, and Inventory. In March, existing-home sales were down by 3.6% due to limited national inventory, while pending homes sales increased by 1.5%, pointing to pent-up housing demand. Existing-home sales decreased a slight 1.0% in March 2026 year-over-year with an increase in inventory to 4.1 months from 4.0 one year ago. During March, there were 1.36 million homes for sale, and existing-home prices increased by 1.4% from $403,100 to $408,800 year-over-year.

(Source: “NAR Pending Home Sales Report Shows 1.5% Increase in March,” National Association of REALTORS®, April 21, 2026.)

The Texas Economy

Despite a slowdown in 2025, Texas continues to be a high-growth market with its notably business-friendly environment, massive A.I. investment, and a diversified industrial base that includes booming technology, manufacturing, and energy sectors. Corporate relocations continue to buoy Texas’ population and job growth, keeping the unemployment rate low at 4.3% as of March 2026. 

The Texas housing market began 2026 with greater inventory and sales. A surge in new listings pushed inventory to record levels that exceeded the highs of 2025, and yielded more closed sales. The growth in inventory led, in part, to more days on market and a slight decrease in the median home price. 

• Home Prices. At $334,900, the median home price in Texas decreased by 1.2% from March 2025 to March 2026. This represents a slight increase of 1.2% from December 2025.

• Home Sales. There were 29,693 closed sales in March 2026, which is up by 5.8% year-over-year as well as 5.8% from December 2025.

• Inventory. Months of inventory averaged 5.0 in March 2026, up from 4.7 in March 2025 and 4.6 in December 2025. As a reminder, a balanced market between buyers and sellers is 6.0 months. Active listings increased by 7.4% to 139,490 in March 2026 from the March 2025 and by 7.8% from December 2025. The increase in inventory from December to March is not unusual given the seasonality of residential real estate sales.

• Velocity of Sales. There were an average days on market in March 2026 was 110, which is 7 days longer than in March 2025 and 1 more than in December 2025.

(Source: “Mar. 2026 Texas Housing Report,” Metrotex, April 2026.)

DFW Residential Real Estate Sales

The DFW market entered the spring selling season with renewed vigor. Inventory and home prices are high, while demand appears to be keeping pace with greater home sales. According to Realtor.com® Economics, he Dallas-Fort Worth-Arlington Metro Area experienced a sizable increase of 8.1% in pending home sales during March, making it the 9th largest market for gains in contract signings year-over-year (Source: “NAR Pending Home Sales Report Shows 1.5% Increase in March,” National Association of REALTORS®, April 21, 2026.)

• Home Prices. The median home price in DFW is now at $385,000, which lands at 2.5% less than in March 2025 at $395,528. It is 2.6% greater than it was in December 2025 at $375,000.

• Home Sales. A total of 8,229 closings occurred during March 2026, which is 4.8% more closings than were seen in March 2025 and represents an increase of 6.8% from December 2025.

• Velocity of Sales. In March 2026, it took 103 days to market and close a property, which is 8 days longer than March 2025 and the exact same number of days as December 2025.

• Inventory. As of March 2026, there were 4.0 months of inventory, which is a slight increase from 3.9 months in March 2025 and a greater increase from 3.5 months in December 2025. Again, a balanced market between buyers and sellers is 6.0 months. There were 30,767 properties on the market in March 2026, which is a 3.6% increase since March 2025 and an increase of 12.1% since December 2025. Some but not all of the inventory growth from December 2025 to March 2026 can be attributed to seasonality, since residential real estate sales typically slow during the fall/winter.

(Source: “Mar. 2026 DFW Housing Report,” Metrotex, April 2026.)

Commercial and Multifamily Market

As of March 2026, both the national and DFW real estate markets are navigating calmer waters, resulting from a gradual absorption of record-high new supply as construction starts lower significantly.

Nationally, the multifamily sector saw a slight increase of 0.2% in asking rents to an average $1,741 in early 2026, while vacancy rates hovered between 9.2% and 9.4%. The other commercial sectors varied a bit. Retail was the best performer with low vacancy and respectable rent growth, while the industrial sector is beginning to normalize with positive net absorption for new facilities. The office sector experienced growth of 7.6% in leasing activity year-over-year, positive net absorption for the 3rd consecutive quarter, and a decline in inventory, while struggling with a high delinquency rate of 11.41% during Q1. (Source: Rowden, Jacob, “U.S. Office Market Dynamics, Q1 2026,” JLL.com, April 15, 2026.)

In DFW, the multifamily sector still has a historic surplus with 30,200 units still under construction, and recent deliveries totaled 7,300 units. As of March, fewer new starts were added to the pipeline. The excess supply has caused vacancy rates to elevate to an average 12.2%, while the average asking rent declined slightly by 2.1% to $1,509 from last year. The market is starting to stabilize as supply and demand slowly become more balanced. (Source: “Dallas-Fort Worth, TX Multifamily Market Report Q1 2026,” Matthews Real Estate Investment Services, April 7, 2026.)

Like national retail, local activity has tightened due to a lack of new supply with mixed-use becoming the standard for new projects. The industrial sector continues to grow with an expansion in logistics and warehousing. Office still has a glut of older inventory, creating a very high vacancy rate of 20.4%, while the rental rate climbed to an average $26.25/SF, which is historically high, due to a greater move toward Class A spaces. (Source: Otillio, Mike and Wallis, Hannah, “Dallas-Fort Worth Office Market Report 2026 Q1,” Colliers Research, April 16, 2026.)

New-Home Construction 

Overall, the market is improving for homebuilders, but clearly the days of peak demand are over… at least for now.

In the U.S., new-home construction is experiencing slow growth due to labor shortages, high construction costs, and relatively high mortgage rates. As a result, builders remain cautious despite a need for inventory.

DFW homebuilders are seeing more stabilization and increased buyer activity this spring. With the expectation of selling down unsold inventory, builders started 4.3% fewer (or 11,106) new homes and closed 10.8% fewer (or 9,777) new homes during Q1 than the previous year, in part, due to fluctuations in mortgage rates and issues with affordability.

Furthermore, there are too many undeveloped lots in DFW — with 110,000 vacant lots and at the current rate of development,  DFW has 32.5 months of inventory. This exorbitant oversupply of lots, slowing job growth, and the factors mentioned above are shaping the new terrain for DFW homebuilders. (Source: Freiman, Justin, “‘Cautiously optimistic’ - DFW homebuilders see early gains, but demand still lagging,” WFAA.com, April 9, 2026).

Food for Thought

The 2026 FIFA World Cup will soon be upon us. DFW has the distinction of being one of the 16 host cities. Beginning on June 14, nine matches will take place in Dallas, including the semifinal on July 14.  

This year’s World Cup will affect the DFW real estate  market in a number of ways. As you may suspect, it will drive up short-term rentals and boost tourism-related property values. It has already accelerated infrastructure development in DFW.

The numbers, of course, tell the tale. In early 2026, short-term rentals during FIFA were up 500% to 700% over last year during the same period. The FIFA World Cup in DFW is projected to create direct economic impact between $400 million to $415 million with as many as 100,000 daily visitors.

A happy byproduct of this major event will be transportation improvements and upgraded facilities, specifically, renovations to the AT&T Stadium, completion of the Cotton Belt Trail Corridor from Plano to Fort Worth, and expansions to DART (Dallas Area Rapid Transit). Increased demand at hotels and short-term rentals will be a boon to local businesses and homeowners, particularly near the AT&T Stadium where the FIFA World Cup will take place. Additionally, a cooling-off period will occur after FIFA ends, which may create a unique opportunity for buyers and investors.

While events of this nature typically inject money into a local economy, they also enhance the appeal for corporations to relocate to an already business-friendly environment as is the case with North Texas. However, during FIFA, traffic on the the roads and at stores, restaurants, and entertainment venues will be intense. In exchange, this major cultural moment will give North Texas major global exposure, allowing us to build on our history as a 1994 World Cup host. 

(Source: Triolet, Steve, “FIFA WORLD CUP 2026: Economic Impact and Legacy for Atlanta, Dallas/Fort worth, Houston and San Antonio,” Market Edge Partners, December 5, 2025.)