I've been watching the data come in from Zillow Research on what the rest of 2026 might look like for housing, and it tells an interesting story about how the market is settling in after some real turbulence. Back at the start of the year, uncertainty around interest rates and inflation had everyone wondering how the rest of 2026 would shake out. The experts at Zillow had mapped out different scenarios depending on how long this rate shock would last, but now that we're halfway through the year, we have a clearer picture.
Here's what's actually happening with home sales volume. According to Zillow Research, the rate shock hasn't disappeared completely, but it has shrunk. That means their 2026 sales growth forecast has landed on the more conservative end of what they predicted back in Q1. They're now expecting sales growth measured by Zillow's metric to come in at 1.2%, with the National Association of Realtors reporting expected growth of 1.9%. So while it's still positive growth, it's more modest than what looked possible at the beginning of the year.
The rental market is following a similar measured pace. Zillow is forecasting that single-family rents will rise about 3.1% for the year, while multifamily rents are expected to climb 2%. These increases are running roughly in line with what we saw in 2025 as new rental supply continues to get absorbed into the market. For renters looking for deals today, Zillow suggests that window of opportunity is closing gradually but not slamming shut immediately.
What really caught my attention is how differently various regions are performing within this overall picture. The research shows that inventory and demand dynamics are creating different trends across the country. The central region is emerging as particularly hot right now, while the Northeast is facing supply constraints that are limiting the sales growth that would otherwise happen there.
Despite 2026 ending up less robust than what people were hoping for back at the end of 2025, Zillow is confident the year will still be positive. Better affordability has been a genuine help to buyers through most of the year, though they note the comparisons get tougher as we move into Q4 since rates were more favorable a year ago.
What I am seeing locally here in the Bay Area is that this measured growth pattern makes sense for our market. While we're not seeing the explosive activity some regions are experiencing, the modest sales growth combined with controlled rent increases gives both buyers and sellers more realistic expectations for the remainder of 2026. For East Bay and Fremont specifically, inventory challenges similar to what the Northeast is experiencing mean we need to be strategic and prepared when opportunities do come up.
