The 2026 Housing Forecast: What 6.3% Rates and Midwest Job Gains Mean for Metro Detroit

December 4, 2025 | Insights by Jeff Duneske, Northville Real Estate Agent

The headlines this week are full of national predictions for 2026, but if you live in Northville, Novi, South Lyon, or Plymouth, the national story doesn't tell the whole truth. While the U.S. housing market is slowly moving toward balance, our specific corner of Metro Detroit is seeing unique economic strength that could keep demand higher than the experts predict.

With mortgage rates expected to stabilize around 6.3% and a surprising boost in Midwest employment numbers, 2026 is shaping up to be a year of opportunity—if you know where to look. Below is my breakdown of the latest data and what it specifically means for your home value.

Fast Facts: Key Takeaways for Home Buyers & Sellers

• 2026 Forecast: Realtor.com predicts 4.13 million home sales (+1.7%) and a gradual increase in inventory (+8.9%) for 2026.

• Rate Outlook: Mortgage rates are expected to average 6.3%, helping the typical mortgage payment drop below 30% of income for the first time since 2022.

• Midwest Resilience: While the U.S. private sector lost 32,000 jobs in November, the Midwest region added 45,000 jobs, signaling local economic strength.

• Market Balance: Inventory is rising but remains about 12% below pre-2020 levels, meaning well-priced homes in Metro Detroit will still see competition.

1. Overview of the Source: Realtor.com & ADP

This week, we are looking at two major economic indicators: the 2026 Housing Forecast from Realtor.com and the November National Employment Report from ADP. Realtor.com is a leading authority on residential data, using MLS listings and economic trends to project the coming year. ADP provides a "real-time" look at the labor market based on actual payroll data.

Together, these reports give us a roadmap. Realtor.com tells us where housing wants to go (more balance), while ADP tells us if buyers have the jobs and income to get us there.

2. The Data: What the Numbers Say

The latest forecast paints a picture of a market that is "healing" rather than "booming."

• Sales & Prices: Existing home sales are projected to rise slightly to 4.13 million (+1.7%), while prices are expected to grow by a modest 2.2%. This suggests we are moving away from the wild volatility of recent years into a more predictable rhythm.

• Mortgage Rates: The 30-year fixed rate is forecast to average 6.3% in 2026. While this isn't the 3% of the pandemic era, it is an improvement that brings monthly payments down by about 1.3% year-over-year.

• Employment Shock: The ADP report delivered a surprise. Nationally, private employers shed 32,000 jobs in November, driven largely by small businesses. However, the Midwest was a bright spot, adding 45,000 jobs—the only region alongside the West to show gains.

3. Jeff’s Expert Take: What This Means for Metro Detroit

I believe the national narrative of a "cooling" market applies less to us here in Metro Detroit than it does to places like Florida or Texas.

The national forecast calls for a "balanced market" with 4.6 months of supply. However, in Northville and Novi, we are likely to remain in a seller's market for longer. Why? Because the local economy is outperforming the national trend. The fact that the Midwest added 45,000 jobs while the Northeast lost 100,000 jobs is a massive indicator of stability for our housing market.

When you combine job security with rates settling in the low 6% range, you get sustained buyer demand. I expect 2026 to be a year where turnkey homes in top school districts (like Northville and South Lyon) continue to see multiple offers, even as the national headlines talk about "slowing down."

4. Local Nuances: The "Insider" View

National reports often miss the specific dynamics of our neighborhoods. Here is what I am seeing:

• The "Sweat Equity" Opportunity: The report explicitly notes that "fixer-uppers" are becoming more common options in the Midwest. In our area, I am seeing a growing gap between updated homes and those needing work. If you are a buyer willing to do renovations, you have significantly more negotiating power right now.

• Inventory Reality: While national inventory is expected to grow 8.9%, supply remains 12% below pre-2020 levels. In sought-after subdivisions in Plymouth and Novi, supply is still incredibly tight. We are not seeing the "flood" of listings that other parts of the country might be seeing.

• The Lock-In Effect: 4 out of 5 homeowners still have a rate below 6%. This means "move-up" buyers are still hesitant. Most of the inventory coming online in 2026 will likely be from life events (jobs, downsizing) rather than discretionary moves.

5. Actionable Advice

• For Buyers: Do not wait for rates to drop to 4%, it’s not in the forecast. With rates stabilizing at 6.3% and local jobs growing, competition will heat up in spring. Look for those "fixer-upper" opportunities in great neighborhoods now.

• For Sellers: Pricing is everything. The forecast predicts price growth of only 2.2%. You cannot price your home for "2022 appreciation" in a 2026 market. Buyers are price-sensitive, and with inventory slowly rising, they will skip over overpriced listings.

Conclusion

The 2026 outlook is positive: stable rates, more homes to choose from, and, crucially for us, a resilient local economy. While the rest of the country navigates a job slowdown, Metro Detroit's employment gains put us in a unique position of strength.

Real estate is hyper-local. If you want to know exactly how these trends impact your home's value in Northville, Novi, or South Lyon, let's connect.

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