Existing home sales rebound from last year while affordability improves
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Home values rose 0.1% in February, the first monthly increase in seven months.
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Existing home sales increased 1.8% year over year and jumped 13% from January.
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Lower mortgage rates have boosted buying power by about $30,000 for median-income households.
The U.S. housing market is beginning to show signs of renewed activity as spring approaches, with home values ticking up and existing home sales improving compared with a year ago, according to Zillows February Market Report.
The typical U.S. home value reached $361,371 in February, rising 0.1% from January and marking the first monthly increase in seven months. Home values are now 0.4% higher than a year earlier, according to the Zillow Home Value Index.
At the same time, sales activity strengthened. Zillow estimates that 239,910 homes were sold in February, a 1.8% increase from a year earlier and a 13% jump from January. Newly pending listings homes that went under contract during the month were up 3.5% year over year and 11.1% from the previous month.
The uptick in sales suggests Januarys softer performance may have been influenced by severe winter weather, while improving affordability is helping bring buyers back into the market.
Zillow's latest data suggests buyers and sellers are starting to regain confidence. Existing home sales rose from a year ago, providing an early glimmer of hope that the housing market has turned a corner after three years bouncing along the bottom, said Mischa Fisher, chief economist at Zillow.
Buyers have more homes within reach to choose from to go along with these friendlier conditions. Lower mortgage rates will also encourage more homeowners who have felt locked in to sell, as they will be better able to afford their next home.
Lower rates are helping
Lower borrowing costs have been a key factor in improving affordability. Zillow estimates that declining mortgage rates over the past year have increased purchasing power by about $30,000 for households earning the median income. The typical monthly mortgage payment on a median-priced home assuming a 20% down payment and excluding taxes and insurance is now $1,738, down 7.7% from a year earlier.
Housing supply has also expanded modestly. There were 1.12 million homes for sale nationwide in February, 5% more than a year ago, and 0.4% higher than in January.
However, the number of newly listed homes slipped slightly compared with last year. Sellers added 283,478 homes to the market in February, a 3% decline from a year earlier, though listings increased 4.9% from January. Zillow noted that winter storms may have slowed listing activity, making the coming months an important test of whether supply will continue to grow.
Competition among buyers remains moderate. Homes spent a median of 28 days on the market before going under contract in February four days longer than a year earlier but significantly faster than January.
Fewer price cuts
Price reductions have also become slightly less common. About 20.3% of listings had a price cut in February, down from both a year earlier and the previous month. Meanwhile, 20.4% of homes sold above their list price in January, slightly lower than the share seen a year earlier.
The rental market is also showing signs of cooling. The typical rent nationwide was $1,895 in February, up 1.9% from a year earlier and 0.4% from January, indicating slower rent growth than in previous years. About 39.2% of rental listings offered concessions, such as free rent or other incentives.
If mortgage rates continue to decline particularly if they dip below 6% Zillow economists say it could further boost confidence among buyers and sellers, potentially setting the stage for a more active housing market after several years of subdued transaction volumes.
Posted: 2026-03-09 16:20:28

















