MBA outlook: slow growth, not a surge
MBA also anticipates modest softening in the labor market, with the unemployment rate rising from 4.6% today to around 4.7% in the first half of 2026, alongside elevated budget deficits and debt that are expected to keep the 10‑year Treasury yield above 4%.
Mike Fratantoni, MBA chief economist, has already signaled that dynamic, saying “our forecast is for mortgage rates to stay within a fairly narrow range over the next few years,” noting that most housing economists do not expect a move back to sub‑6% borrowing costs.
On the housing side, MBA’s forecast points to growing inventory in many markets, helping to support more purchase activity as buyers see a wider set of options and home price growth cools, including outright price declines in a rising number of metros.
Nationally, the group expects price growth to slow to roughly 1% by late 2025 before dipping slightly into negative territory in late 2026, reflecting higher supply and weaker demand.
“An increase in housing supply, combined with cooling rates, [was] going to open the door for homebuyers in more markets,” Fratantoni told Mortgage Professional America, adding that “in more and more markets around the country, it’s going to be a buyer’s market as opposed to a seller’s market that it’s been for a number of years.”
