US Housing Market Pulse: 2026 Q1
How is Housing Affordability Impacting Key Homebuilders’ Margins?
Housing affordability remains the central obstacle for the US market in 2026, with the median existing-home price rising 50% between 2019 and 2024, while household income grows far more slowly. Homebuilders are facing a problem: new-home inventory sits at 10.3 months of supply, well above the historical average of 6.2, forcing builders to manage unsold homes carefully and limiting price recovery.
According to Morningstar’s analysis, mortgage rates are the single biggest lever on housing demand right now, with the average 30-year fixed mortgage rate more than doubling from its 2021 low. Mortgage rates have since eased from their peak, but geopolitical uncertainty and renewed inflation concerns have started pushing rates back. If mortgage rates decline further, Morningstar expects existing-home sales to recover and turnover to increase.
Get the complete picture on US housing heading into the back half of 2026. Morningstar's Q1 report gives advisors and wealth managers the data and stock-level insight to guide client conversations on housing-sector exposure.
What's Inside
- A closer look at homeownership versus renting trends, as well as the housing supply and affordability dynamics shaping demand.
- An analysis of homebuilder pricing power and the factors influencing consumer sentiment.
- Morningstar’s top housing stock picks and a comprehensive view of current industry coverage.