Jaime’s Real Estate Brief What to Expect in 2026: Inflation, Rates, and the Housing Market Ahead
- Jaime Hechtman Ulloa
- 6 days ago
- 3 min read
By Jaime Hechtman Ulloa
📞 631.664.0268
As we move toward 2026, I’m getting one question more than any other: What’s really coming next for the housing market? Between inflation headlines, Federal Reserve decisions, and mixed economic signals, it’s understandable that buyers and homeowners are feeling cautious. But when you look closely at the data, the story is far more nuanced, and far more local, than the national headlines suggest.
Let’s start with inflation, because it’s driving much of what happens next. The most recent inflation report shows that prices didn’t spike, but they didn’t meaningfully cool either. Food costs continue to climb, especially at the grocery store and restaurants. Housing costs are still rising as well, even though many people are hearing that rents are “softening.” That’s because the data that feeds inflation reports reflects longer-term averages, not just what’s happening in a single leasing season.
At the same time, lower gas prices helped keep overall inflation from accelerating. This balance… stubborn costs in everyday essentials paired with relief in energy is exactly why the Federal Reserve is signaling patience. Inflation isn’t worsening, but it hasn’t improved enough to justify aggressive rate cuts. As we head into 2026, that means interest rates are more likely to remain steady than suddenly drop.
What does that mean for buyers? It means waiting for dramatic rate relief may not be the winning strategy many are hoping for. Mortgage rates could ease slightly, but the bigger force to watch is pricing. Housing costs continue to rise, and even small increases in home prices often outweigh modest changes in interest rates when it comes to monthly payments.
Another important signal comes from the Federal Reserve’s own financial accounts. In the third quarter of 2025, the total value of owner-occupied real estate in the U.S. dipped by about $361 billion. That sounds dramatic until you look at the full picture. The total value of U.S. homes still sits just over $48 trillion - well above where it stood in 2024. In other words, this was a pause, not a collapse.
From my perspective on Long Island, this matters a lot. When national home values stabilize after years of rapid growth, it often creates a reset in expectations rather than a downturn. Sellers become more realistic. Buyers gain negotiating confidence. But demand doesn’t disappear especially in markets like Nassau and Suffolk counties, where inventory remains limited and housing options are constrained.
Looking ahead to 2026, I expect a market defined less by volatility and more by selectivity. Buyers will be smarter and more prepared. Sellers who price correctly will still move quickly. And areas with strong fundamentals transportation access, infrastructure investment, and community growth will continue to outperform.
Housing costs rising faster than wages is still a challenge, but that’s exactly why real estate remains such a powerful long-term asset. Even when values flatten temporarily, ownership continues to build stability and equity over time. The data confirms that while prices may ebb and flow quarter to quarter, housing remains one of the strongest components of household wealth.
The biggest mistake I see people make is waiting for a perfect moment that never arrives. Markets don’t ring bells at the bottom or top. What they do is reward informed decisions made with a clear understanding of local conditions, financing realities, and long-term goals.
As we move into 2026, my advice stays consistent: focus less on headlines and more on strategy. If you’re buying, understand what you can afford comfortably today and where future value lies. If you’re selling, preparation and pricing matter more than ever. And if you’re simply watching the market, now is the time to get educated so you’re ready when opportunity appears.
That’s what I’m here for. I’ll continue tracking the data, the trends, and what they mean specifically for Long Islanders not just nationally, but right here at home.
And with many households expecting larger tax refunds this year, knowing how to position that money, whether toward savings, a down payment, or future housing costs can make a real difference.
If you’re wondering how these shifts could affect your plans, I’m always happy to talk it through.
Jaime Hechtman Ulloa
631.664.0268
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