Housing Market Predictions for 2027: What Fannie Mae and MBA Forecast

The two newest big forecasts see a flat housing market in 2027: home prices up less than 1%, sales about the same as 2026, and 30-year mortgage rates above 7%. Fannie Mae's Oct. 12, 2026 forecast and the Mortgage Bankers Association's Oct. 11, 2026 forecast agree on the big picture. These are forecasts, not promises, and they change month to month.

What do experts predict for the housing market in 2027?

Here is what the two forecasts published this month say about 2027.

Both see 2027 looking a lot like 2026. Fannie Mae's same forecast puts 2026 existing-home sales at 4.031 million, and MBA's puts them at 4.081 million. So neither expects a big jump or a big drop in how many homes sell.

Will home prices drop in 2027?

Neither forecast calls for a national drop. Both call for small gains.

• Fannie Mae (Oct. 12, 2026): home prices up 2.7% in 2026, then up 0.6% in 2027.

• MBA (Oct. 11, 2026): the FHFA purchase-only price index up 0.8% in 2026 and 0.5% in 2027.

New homes are a little different. MBA's forecast puts the median new home price at about $403,000 in 2026 and $400,000 in 2027. And the latest government numbers already show new-home prices below last year. The Census Bureau's New Residential Sales report for August 2026 (released Sept. 24, 2026) put the median new home sales price at $393,700, down 5.8% from $417,900 in August 2025.

A national number is an average of very different markets, so prices where you are shopping may not follow it.

Will mortgage rates go down in 2027?

Not by much, if these forecasts are right.

Today's starting point: the 30-year fixed rate averaged 7.40% in Freddie Mac's Primary Mortgage Market Survey for the week of Oct. 15, 2026. A year earlier it was 6.27%.

• Fannie Mae (Oct. 12, 2026) expects the 30-year rate to average 7.5% in every quarter of 2027.

• MBA (Oct. 11, 2026) expects 7.2% early in 2027, easing to 7.1% by the end of the year. MBA's write-up of its forecast (Oct. 12, 2026) put it this way: ""MBA expects that mortgage and Treasury rates are likely to come down from their recent peaks.""

Forecasts move fast. Fannie Mae's July 10, 2026 forecast expected a 6.3% average rate for 2027. Three months later, that same forecaster says 7.5%. That is a good reason not to plan a purchase around any single forecast.

Will fewer new homes be built in 2027?

Both forecasts expect builders to start fewer homes.

The home builders' trade group says the same thing. In an Oct. 1, 2026 post, the National Association of Home Builders (NAHB) wrote that ""2026 will be the second year in a row with a decline for single-family home building"" and that ""signs indicate further declines in 2027.""

Builders are also feeling the squeeze. In the NAHB/Wells Fargo Housing Market Index released Sept. 16, 2026, builder confidence fell to 32. In that survey, 38% of builders said they cut prices and 66% used sales incentives.

New-home sales are still moving. The Census Bureau's August 2026 report put new home sales at a seasonally adjusted annual rate of 684,000, up 6.4% from July and down 2.0% from August 2025. The next report is scheduled for Oct. 27, 2026.

How should you read a housing forecast?

Forecasts are useful, but they are easy to misread. Three tips:

• Check the date. Every number above comes with the day it was published. Fannie Mae's October forecast says its interest rate assumptions were set as of Sept. 30, 2026. Anything that happened after that is not in it.

• Check what is being measured. Fannie Mae and MBA use different price indexes, so 0.6% and 0.5% are close but not the same measure. MBA's yearly mortgage rate figures are fourth-quarter numbers, not full-year averages.

• Compare forecasts over time. Fannie Mae's July forecast had 2027 new single-family home sales at 688,000. In October it was 652,000. When the same forecaster changes its view that much in three months, treat any single number as a rough guide.

Is 2027 a good time to buy a new-construction home?

That depends on your budget, your timing and the home, not on a forecast. But the forecasts point to a few things worth knowing:

• Waiting for a big rate drop is a bet. Neither October forecast shows one in 2027.

• Prices are forecast to be flat, not falling. Both call for national price gains under 1% in 2027.

• Builders are using incentives. NAHB's September survey found 66% of builders used them. Incentives change often, so ask what is on the table for the exact home you want.

What this means for new-construction buyers

Here is how to use these forecasts if you are shopping for a new home:

• Plan around today's rate, not a forecast. Run your budget at today's rate. If rates fall later, that is a bonus, not the plan.

• Ask about rate buydowns. A builder-paid buydown can lower your payment for a few years or for the life of the loan. Our guide to builder mortgage rate buydowns explains how they work.

• Match your rate lock to the build. A to-be-built home can take months. Read when to lock your mortgage rate and how long it takes to build a house.

• Check numbers in your market. National forecasts are averages. Call 561-704-0091 for today's numbers on homes and incentives in the communities you like.

Common Questions

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Related reading: Will mortgage rates go down? · Is now a good time to buy a house? · Builder mortgage rate buydowns explained

This is general information, not financial, tax or legal advice. Figures checked October 16, 2026.