Mortgage rates sat under 6% in February. Now they’re over 7%.
The difference can add more than $300 a month to a homebuyer’s monthly payment on a typical home purchase, which for many buyers is enough to push homeownership back into “someday” territory.
Realtor.com’s chief economist Danielle Hale called this out during her conversation with Byron Lazine and Lisa Chinatti on Friday’s Knowledge Brokers Podcast. When Lazine asked her how difficult the end of the year will be for the housing market, she described the fall as a “sweet spot” for buyers before getting into the bigger structural problems impacting some buyers more than others.
From the K-shaped housing market to the Let America Build campaign, Hale shared her analysis of the market and what agents can expect, as well as what they can do right now.
How Difficult Will Q4 Be For The Market And The Agents Serving It?
Lazine asked Hale straight out: “How difficult are the next four months, the last quarter of 2026, going to be for the market and the agent serving it?”
Hale’s answer depends on which side of the transaction you’re standing on.
For buyers, she called it a seasonal sweet spot.
“It’s not a fast-moving seasonal time. We do often call it a seasonal sweet spot for buyers in the sense that the market is less competitive.”
The same slow pace turns into a problem for agents who depend on steady transactions to pay the bills.
Rate swings are the bigger story behind all of it. Rates are sitting at a one to two year high, and that kind of move changes what a buyer can afford within a few months.
Hale previewed a research piece her team has coming, meant to help buyers plan around that swing instead of getting caught off guard by it.
“We often say rate proof your budget, and that means take a look at where mortgage rates are today, but you should set a little bit higher and a little bit lower.”
In plain terms, that means encouraging your buyers to check what they can afford right now, and what they can afford if rates climb a bit from where they sit now.
What Is The K-Shaped Housing Market
Lazine asked about a term more familiar from the stock market than from housing:
“If you’re investing in stock market, then you’ve heard of this K-shaped economy. Danielle, what’s the K-shaped housing market?”
Hale explained it as two different markets moving at two different speeds.
“The K-shaped housing market, sort of like the K-shaped economy, talks about how we see different trends for upper-end buyers, or higher-income, higher-price buyers, versus lower-price buyers.”
At the low end, where first-time buyers shop, demand used to run far ahead of supply. Her team’s data backs up the change:
“We are not seeing demand or page views online outstrip supply as much at those lower price points than we have in years past.”
Chinatti sees the same split in her own market. She broke her price points down like this:
- Softest activity: under $600,000
- Steady activity: $800,000 to $1.2 million, with a slight pullback near the top of that range
- No pullback at all: above $3 million
Lazine asked Chinatti if she’s moving marketing dollars toward the high end for next year, and asked Hale if that’s the right move.
Chinatti called it a “calculated risk,” saying she’s keeping her bread and butter listings funded while she builds a pipeline for early next year.
Hale backed the strategy, pointing to equity as the reason the top of the market keeps moving.
“I think it sounds like a good move. The volume, quantity wise, is still in that median price category, but if you look at the upper end, it has been behaving differently. There are a couple reasons why that’s likely the case. You’ve got stock market still close to record high valuation, so there’s equity there from the equities market. You’ve also got home prices that are still close to record high.
“Just this week, my colleague Jiayi Xu put out a report looking at the Federal Reserve data on home equity and the value of real estate, and according to that Fed data, it’s at a new high. So homeowners who are already homeowners have a lot to draw on when it comes to converting that equity into another home purchase.”
Without that same equity to draw on, first-time buyers feel higher rates first.
How Will The Let America Build Campaign Address The Shortage
Realtor.com launched a joint campaign this year called Let America Build, alongside Zillow, eXp Realty, Next Home and at least ten other organizations across the industry.
Lazine asked Hale what the campaign sets out to do. She framed it as the industry taking a stand together.
“This Let America Build campaign is really about taking a stand as an industry. We know that we don’t have enough homes nationwide. We know that there’s some variation in where we need more homes like most acutely….But what this campaign is really trying to do is raise awareness among consumers.”
It makes sense to put this information in front of the people who vote on local housing policy. And with mid-terms coming up, the timing is spot on.
What Can Agents Do To Help
Lazine asked who’s most responsible for getting through to the places furthest behind on changing the rules that limit building, regions like the Sun Belt states.
Hale’s answer: agents and brokers.
“I would say it is probably the business community, and so real estate agents and brokers who are part of that business community, who are especially informed about the problems that are facing builders.”
Her point: agents know what’s broken in their own backyard. Their job is telling their communities what needs to change.
She named one concrete place to start.
“There’s a website, letamericabuild.org, that has toolkits to enable industry professionals to share that messaging broadly. We’ve also developed toolkits for consumers.”
The toolkits are already live, built for the industry and for the consumers you work with every day, including buyers wondering why it’s so hard to find homes that fit their budget and homeowners who aren’t aware of how local zoning restrictions and NIMBY-ism are impeding new construction at lower price points.
Intentional or not, it’s those local hurdles that are driving up the cost of homebuilding and effectively keeping homeownership out of reach for many.
Where This Leaves Agents Heading Into 2027
None of this is settled yet. Rates could ease. They could also stay stuck above 6.5-7%. Hale’s team is still working on the research piece that will give buyers real numbers to plan around, so keep an eye out for it this quarter.
Team leaders like Chinatti are setting their 2027 budgets now, based on where their own market sits on that K-shaped curve.
Agents can do the same thing on a smaller scale. Pull up your own market’s price bands. See where the pullback sits in your own numbers.
The Let America Build toolkits at letamericabuild.org are online today, ready to use this week. If you’re the one sharing the information your local buyers need to feel smarter about what they’re facing, you’re also the one they’ll look to when they’re ready to start shopping for homes.
