NAR: Home Prices Rise in 80% of U.S. Metro Areas Despite Higher Mortgage Rates
Home prices continued to climb across most U.S. housing markets during the second quarter of 2026, reinforcing homeowner equity gains while leaving affordability a challenge for many prospective buyers, according to new data from the National Association of REALTORS® (NAR). NAR's latest metro home price report found that median existing single-family home prices increased year over year in 80% of the nation's metropolitan areas, up from 71% in the first quarter. Nationally, the median existing single-family home price reached $434,900, a 1.5% increase from the second quarter of 2025. While higher home prices continue to pressure buyers, declining mortgage payments compared with a year ago and stronger household income growth have modestly improved affordability.
By Ira Margolis · 5 min read
Home Prices Rise in 80% of U.S. Metro Areas as Affordability Improves Slightly Despite Higher Mortgage Rates
Home prices continued to climb across most U.S. housing markets during the second quarter of 2026, reinforcing homeowner equity gains while leaving affordability a challenge for many prospective buyers, according to new data from the National Association of REALTORS® (NAR).
NAR's latest metro home price report found that median existing single-family home prices increased year over year in 80% of the nation's metropolitan areas, up from 71% in the first quarter. Nationally, the median existing single-family home price reached $434,900, a 1.5% increase from the second quarter of 2025.
While higher home prices continue to pressure buyers, declining mortgage payments compared with a year ago and stronger household income growth have modestly improved affordability.
Home sales rise despite higher borrowing costs
NAR Chief Economist Lawrence Yun said the housing market has shown resilience even as mortgage rates have moved higher.
"Home sales increased despite mortgage rates rising. This testifies to the potential housing demand building up from steady job and income gains," Yun said.
Yun noted that existing-home sales increased in three of the four major U.S. regions during the quarter, with the South posting the strongest gains thanks to faster employment growth. The Northeast was the only region to record weaker sales, reflecting slower job growth and faster home-price appreciation that weighed on affordability.
"It is welcoming to see incomes rising faster than home prices, which has helped boost affordability—but the big short-term challenge to affordability is coming from rising mortgage rates," Yun added.
Affordability shows modest improvement
Despite elevated mortgage rates, affordability improved compared with a year ago.
During the second quarter, Freddie Mac reported the average 30-year fixed mortgage rate ranged between 6.23% and 6.53%, below the 6.62% to 6.89% range recorded during the same period in 2025. However, rates have recently moved higher, with Freddie Mac's latest weekly survey showing the average 30-year mortgage reaching 6.66%, the highest level in nearly a year.
According to NAR:
The typical monthly mortgage payment for buyers making a 20% down payment on an existing single-family home was approximately $52 lower than one year earlier.
First-time buyers purchasing a starter home with roughly 10% down paid about $49 less per month than comparable buyers in the second quarter of 2025.
Typical families spent 23.8% of household income on mortgage payments, down from 25.5% a year earlier.
First-time buyers devoted 35.9% of income to housing payments, an improvement from 38.4% in the second quarter of 2025.
The data suggests lower financing costs earlier in the year and stronger wage growth helped offset continued home-price appreciation for many households.
Regional markets remain uneven
Price appreciation varied considerably across the country.
Region | Median Existing Single-Family Home Price | Annual Change |
|---|---|---|
Northeast | $547,200 | +3.8% |
Midwest | $340,800 | +3.6% |
South | $380,000 | +1.0% |
West | $637,900 | -0.8% |
The Northeast and Midwest posted the strongest regional price gains, while the West was the only region to experience an annual decline in median home prices.
Metro areas with the largest price gains
NAR identified several smaller and midsize markets that posted double-digit or near-double-digit appreciation over the past year.
The strongest-performing metro areas included:
Beaumont-Port Arthur, Texas (+11.0%)
Naples-Immokalee-Marco Island, Florida (+10.5%)
Gulfport-Biloxi-Pascagoula, Mississippi (+10.3%)
Syracuse, New York (+9.6%)
Hartford-West Hartford-East Hartford, Connecticut (+8.0%)
Lansing-East Lansing, Michigan (+7.8%)
Canton-Massillon, Ohio (+7.7%)
Providence-Warwick, Rhode Island-Massachusetts (+7.4%)
York-Hanover, Pennsylvania (+7.4%)
Milwaukee-Waukesha-West Allis, Wisconsin (+6.8%)
California continues to dominate the nation's most expensive housing markets
California remained home to most of the country's highest-priced metro areas, despite mixed annual price performance.
The 10 most expensive markets in the second quarter were:
Metro Area | Median Price | Annual Change |
San Jose-Sunnyvale-Santa Clara, Calif. | $2,050,000 | -4.2% |
San Francisco-Oakland-Hayward, Calif. | $1,500,000 | +5.2% |
Anaheim-Santa Ana-Irvine, Calif. | $1,485,000 | +3.7% |
Urban Honolulu, Hawaii | $1,183,000 | +3.0% |
San Diego-Carlsbad, Calif. | $1,075,000 | +4.9% |
Salinas, Calif. | $982,600 | +0.4% |
Oxnard-Thousand Oaks-Ventura, Calif. | $961,800 | +0.4% |
San Luis Obispo-Paso Robles, Calif. | $954,400 | +2.8% |
Bridgeport-Stamford-Norwalk, Conn. | $885,100 | +4.7% |
Los Angeles-Long Beach-Glendale, Calif. | $879,900 | Unchanged |
What it means
The latest NAR data points to a housing market where price appreciation remains widespread despite elevated borrowing costs. While affordability has improved modestly thanks to lower mortgage payments than a year ago and faster income growth, higher mortgage rates continue to limit purchasing power for many households.
Whether affordability improves further will largely depend on the direction of mortgage rates, wage growth and housing inventory during the second half of 2026.