A New Year for Housing: 2026

Every new year brings predictions about real estate, some hopeful, some dramatic, many recycled. As we look ahead to 2026, the housing market isn’t reacting to headlines or short-term sentiment. It’s responding to structural forces that are unlikely to reverse anytime soon. Read on to understand where housing is headed. We’ll zoom out to observe what’s already shaping buyer and seller behavior.

Money Printing Didn’t Disappear, Its Effects Are Ever Lasting

Over the last 5+ years, the U.S. dramatically expanded the money supply. This caused extreme price increases; while inflation has technically cooled, those additional dollars didn’t disappear. They reshaped asset prices, expectations, and long-term cost structures.

Housing reflects this clearly. Construction costs, land values, labor, and insurance expenses all remain elevated. Even as inflation slows, the baseline cost of producing housing is higher than it was pre-2020. This helps explain why home prices didn’t collapse when interest rates rose: the cost of borrowing changed, but the value floor didn’t reset.

As we move into the new year, real estate continues to function as a long-term hedge against currency dilution (aka inflation). That doesn’t mean runaway appreciation but it does mean a full collapse to past price levels is increasingly unlikely.

Interest rates are likely to stay… boring

Many buyers are waiting for dramatic rate cuts. Most economists aren’t. The more likely scenario is rate stability, not rate relief. With the labor market easing gradually (rather than sharply increasing) and inflation only partially cooled, borrowing costs are expected to remain elevated. That predictability matters. When rates stop swinging wildly, buyers adapt. Sellers recalibrate. Transactions become more intentional. The market shifts from shock to normalization, slower, yes, but more disciplined.

At the same time, recent actions by the Federal Reserve to maintain liquidity in the financial system suggest a continued commitment to market stability. While this isn’t the aggressive quantitative easing of the past, these quieter measures help support credit markets and historically place a floor under asset values. For housing, that dynamic reinforces stability rather than sharp crashes.

Supply looks different in Bend

Nationally, housing supply remains constrained but Bend is an important exception. Compared to this time last year, Bend is carrying significantly more active inventory, giving buyers more choice and negotiating power than they’ve had in several years. As expected, prices have adjusted downward to reflect that increased supply. This doesn’t signal a crashing market, it signals a functioning one.

Price softening has been measured and uneven, with the most notable adjustments occurring among homes that were aggressively priced or slower to adapt to today’s interest-rate environment. Well-located, well-maintained homes priced realistically are still selling (even with multiple offers), just without the outrageous over asking offers of past cycles.

In Bend, higher inventory is enabling price discovery, not distress. Sellers are responding to real buyer feedback, and buyers can evaluate options without rushing. It’s normalization!

Looking toward 2026: evolution, not collapse

Most long-range forecasts looking toward 2026 point to moderation rather than disruption. What’s changing isn’t whether real estate works as a long-term asset, but how people participate. Financing creativity, regional nuance, and lifestyle-driven decisions matter more than betting on macro shifts.

Housing is entering a more mature phase, shaped by monetary policy, evolving supply dynamics, and a buyer pool that has adjusted to higher costs of capital. The winners won’t be those trying to predict the next dramatic shift, but those who understand the forces already at work and act with discipline.

Real estate hasn’t lost its relevance. It’s simply demanding more of it in 2026.

This article appears in the Source January 1, 2026.