If you’re thinking about buying or selling before the new year, this real estate market forecast is built for you. The last two months of 2026 are shaping up very differently than the real estate market forecast most experts made back in the spring.
Mortgage rates just posted their biggest weekly jump in almost four years. The Federal Reserve raised rates in September for the first time since 2023. And here in the Central Valley, prices are holding up better than the headlines suggest, but buyers are finally getting room to negotiate.
I’m Laith Warda, a Realtor serving Turlock, Modesto, and all of Stanislaus and Merced counties. Below, I break down my real estate market forecast: what the data says right now (as of early October 2026), what I expect for the November December housing market, and the exact moves I’m recommending to my own buyers and sellers.
Quick Answer: The Real Estate Market Forecast at a Glance
- Mortgage rates: Expect the 30-year fixed to stay roughly between 6.9% and 7.5% through December, with more upside risk than downside.
- Home prices: Flat to slightly lower in Stanislaus County through year-end, with seasonal softening after Thanksgiving. Nationally, prices are still rising, but slowly.
- Inventory: Fewer new listings during the holidays, but more homes sitting longer, which means more price cuts and seller credits.
- Who has the edge: Prepared buyers. Sellers who price correctly from day one will still sell, often faster than spring because of lighter competition.
Now let’s dig into the details behind this real estate market forecast, starting with where things stand today.
Where the Market Stands Heading Into November 2026
Any good real estate market forecast starts with the current numbers. Here’s the snapshot I’m working from, with the date of each figure, because this market is moving fast.
| Metric | Latest figure | As of |
|---|---|---|
| 30-year fixed mortgage rate (Freddie Mac) | 7.28% (6.34% a year ago) | Oct 1, 2026 |
| Federal funds target range | 3.75%–4.00% | Sept 16, 2026 |
| U.S. median existing-home price | $429,100 (+1.6% year over year) | August 2026 |
| U.S. months of supply | 4.9 months | August 2026 |
| California median single-family price | $901,420 (+0.1% year over year) | August 2026 |
| Central Valley median price | $500,000 (+1.0% year over year) | August 2026 |
| Stanislaus County median price | $475,000 (−4.9% year over year) | August 2026 |
| Merced County median price | $439,740 (+5.1% year over year) | August 2026 |
| Turlock median sale price (Redfin) | $509,663 (+1.5% year over year) | August 2026 |
Rates Are the Big Story
According to Freddie Mac’s latest Primary Mortgage Market Survey, the 30-year fixed averaged 7.28% on October 1, up from 7.03% just one week earlier. That was the sixth straight weekly increase and the highest reading since November 2023.
The 15-year fixed climbed to 6.60%. A year ago, it was 5.55%. That gap matters, because it shows how quickly affordability has changed for buyers who were shopping last fall. It’s also the biggest swing factor in any real estate market forecast this season.
Inventory Is Building Nationally
The National Association of Realtors August report showed 1.62 million homes for sale, up 5.9% from a year ago. That equals 4.9 months of supply, the highest level in more than ten years.
That’s the headline for housing inventory 2026: more choices, more time, and more negotiating room for buyers. Sales slipped 2.0% from July to a 3.98 million annual pace. Even so, the median price rose for the 38th straight month, just at a slower clip. That slowing pace is a key signal in this real estate market forecast.
The Central Valley Is Holding Steady
California tells a slightly different story. In the California Association of Realtors (C.A.R.) August 2026 report, the Central Valley was one of only two regions where sales rose year over year (up 1.5%).
Central Valley home prices held at a $500,000 median, unchanged from July and up 1.0% from last year. Compare that to the Bay Area’s $1,272,000 median, and you can see why our region keeps attracting commuters and remote workers. It’s a big reason my real estate market forecast for our area is steadier than the national picture.
Mortgage Rate Forecast for November and December 2026
The single biggest variable in this real estate market forecast is where mortgage rates go next. My mortgage rate forecast for the rest of 2026 is a range of about 6.9% to 7.5% on the 30-year fixed, with a base case near 7.1% to 7.3%.
That’s my professional real estate market forecast, not a guarantee. Rates can move a quarter point in a single week, as we just saw. Here’s what’s driving my thinking.
Why Rates Climbed So Fast
Mortgage rates track the 10-year Treasury yield more closely than they track the Fed. On October 1, the 10-year yield rose to about 5.29%, according to The Mortgage Reports. That puts steady upward pressure on mortgage pricing.
Behind the bond selloff is inflation. The Real Deal reports that investors have been pricing in inflation risk tied to the conflict with Iran, which has pushed up energy prices and complicated trade. As long as energy costs stay high, it’s hard to see rates falling quickly.
Federal Reserve Interest Rates: Two Meetings to Watch
On September 16, the Fed voted 12–0 to raise its benchmark rate by a quarter point to 3.75%–4.00%. As CNBC covered in its report on Federal Reserve interest rates, it was the first hike since 2023, and officials signaled another could come this year.
Two dates will shape the November December housing market:
- October 27–28: Markets are split between a hold and another quarter-point hike, per the FOMC meeting schedule tracker.
- December 8–9: This meeting includes updated projections and the “dot plot,” which will tell us how many more hikes the Fed expects in 2027.
A Fed hike doesn’t automatically raise mortgage rates. But a hawkish tone usually pushes bond yields higher, and mortgage rates follow.
What the Big Forecasters Are Saying
Zillow recently revised its mortgage rate forecast upward to 7.1% by year-end, according to Yahoo Finance. Fannie Mae’s September outlook projected a 6.8% average for the fourth quarter. Keep in mind that Fannie’s rate forecast was based on rates from August 31, before the latest jump.
The takeaway for any real estate market forecast: nobody serious is predicting a return to the 6% range before New Year’s.
What 7.28% Means for Your Monthly Payment
Let’s use a real local example. Say you buy at Stanislaus County’s August median of $475,000 with 10% down, borrowing $427,500.
- At last year’s 6.34% rate, principal and interest runs about $2,660 per month.
- At today’s 7.28%, that same loan runs about $2,925 per month.
That’s roughly $265 more every month, before taxes and insurance. It’s exactly why I’m pushing buyers toward seller credits and rate buydowns this winter (more on that below). Payment math like this belongs at the center of any real estate market forecast.
Home Price and Inventory Forecast for the Holidays
Higher rates usually cool demand, and demand drives prices. So the next piece of this real estate market forecast is what happens to values and supply through the end of the year.
Real Estate Market Forecast for Prices: Slower Growth, Not a Crash
Nationally, prices are still rising. Fannie Mae’s September housing forecast projects home price growth of 2.3% in the fourth quarter of 2026, slowing to about 1.0% for all of 2027. In real estate market forecast terms, that’s a cooldown, not a collapse.
California is softer. C.A.R. noted in its August report that prices typically ease during fall and winter. With rates surging, its economists warned that home prices may face added downward pressure through year-end.
My local real estate market forecast for Stanislaus County closings in November and December is a median somewhere around $460,000 to $490,000. That would be flat to a few percent below last year. Remember that winter medians often dip simply because fewer high-end homes sell during the holidays.
Inventory: Fewer New Listings, More Stale Ones
Here’s a pattern that shapes every winter real estate market forecast I write. New listings drop sharply after mid-November as sellers wait for spring. But the homes already on the market sit longer, and many sellers get more flexible as the holidays approach.
That creates a two-sided November December housing market:
- Fewer total options for buyers who want a fresh listing.
- More motivated sellers among the homes that have been on the market 45 to 90 days or longer.
Statewide, C.A.R.’s Unsold Inventory Index rose to 3.7 months in August, the highest in six months. Active listings actually slipped, which tells us homes are taking longer to sell, not that a wave of new supply arrived.
Sale-to-List Ratios and Price Cuts
In California, homes sold for 98.9% of list price on average in August. Locally, Merced County sat right at 98.9% on Redfin’s Merced County real estate data. In plain English: most buyers are paying slightly under asking, not over.
I expect that gap to widen a bit in December. Sellers who priced for the spring market and haven’t adjusted will likely cut prices or offer credits before year-end.
Local Real Estate Market Forecast: Turlock, Modesto, Stanislaus and Merced
National headlines are useful, but real estate is local. Here’s how this real estate market forecast plays out in the communities I serve every day.
Turlock Real Estate Market
The Turlock real estate market posted a median sale price of $509,663 in August 2026, up 1.5% from a year earlier, according to Redfin. That’s steadier than the countywide numbers.
Movoto’s data shows 187 active listings and a typical 54 days on market in August. If you’re browsing Turlock homes for sale, that means you have real choices and usually some time to decide.
Different data sources measure the market in different ways, so the exact figures won’t always match. The trend is what matters, and the trend in Turlock is stable prices with longer selling times.
My Turlock real estate market forecast for November and December: Prices hold roughly flat, days on market stretch past 60 for many listings, and well-priced homes in north Turlock still draw solid interest. I’d call it a balanced market leaning toward a buyer’s market in Turlock for anything overpriced.
Modesto Housing Market and Stanislaus County
The Stanislaus County housing market is where the softening shows up most clearly. C.A.R. reported an August median of $475,000, down 4.8% from July and 4.9% from August 2025. Sales were down 1.4% year over year.
Yet homes are still selling quickly when priced right. The county’s median time on market was 22.5 days in August, faster than last year’s 25.5 days. The Unsold Inventory Index sat at 3.6 months.
The Modesto housing market drives much of that county data because it’s our biggest city. Modesto gives buyers the widest range of price points in Stanislaus County, from starter homes to larger family properties. That variety should keep sales moving even through the holidays.
My Stanislaus County real estate market forecast: Prices drift flat to slightly lower through December. Expect more seller concessions, especially on homes priced above $550,000.
Merced County Real Estate
Merced County real estate surprised to the upside in August. C.A.R. reported a median of $439,740, up 5.1% from last year, with sales up 22.6%. Inventory was tight at 3.0 months.
Redfin’s three-month view is more modest, showing a $421,000 median, down 1.2%. The difference comes from different time frames and data sets. Either way, Merced remains one of the more affordable options within reach of Highway 99 commuters.
My Merced County real estate market forecast: Steady demand from first-time buyers keeps prices near current levels. Atwater, Los Banos, and Merced should stay competitive under $450,000.
Central Valley Home Prices vs. the Rest of California
The gap between the Central Valley and the coast is still enormous. The statewide median is above $900,000, while Central Valley home prices sit around $500,000. That affordability gap is the long-term support under our local market, even when rates spike.
7 Smart Moves for Holiday Home Buying in a 7% Rate Market
Buyers who stay active through the holidays often get the best deals of the year. Fewer people are touring homes between Thanksgiving (November 26) and New Year’s, and sellers who list in December usually need to move. Here’s how I’d use this real estate market forecast if I were buying right now.
- Get fully underwritten, not just pre-qualified. In a slower market, a strong preapproval is your best negotiating tool. Sellers will take a lower offer from a buyer who can close in 30 days over a higher offer that might fall apart.
- Target homes that have been sitting. Ask me to pull listings with 45+ days on market or recent price drops. These sellers are the most open to negotiation, and many will consider relaunching or reworking their pricing rather than waiting for spring.
- Ask for a seller credit instead of a bigger price cut. A credit used to buy down your rate can save you more each month than the same dollars taken off the price. On a $427,500 loan, every quarter point is worth roughly $70 a month in principal and interest.
- Compare fixed and adjustable loans carefully. CNN reported that ARMs were priced about 80 basis points below fixed loans and made up 10.3% of applications, the highest share since October 2025. An ARM can make sense if you’ll sell or refinance within the fixed period, but only if you understand how the adjustment works.
- Time your rate lock around the Fed. The October 28 and December 9 Fed decisions can move bond markets. If you’re in contract near either date, talk to your lender about locking before the announcement.
- Budget for year-end closing costs. California’s first property tax installment becomes delinquent after December 10, which affects your closing prorations. My post on the hidden costs of holiday home buying walks through every fee to plan for.
- Don’t count on a quick refinance. “Marry the house, date the rate” only works if rates fall. Fannie Mae’s latest outlook shows rates near 6.7% through 2027, so make sure today’s payment works for your budget on its own.
Is It a Buyer’s Market in Turlock?
Not across the board, but my real estate market forecast says it’s closer than it’s been in years. For homes that are priced above recent comps or need work, buyers absolutely have the upper hand right now. For move-in-ready homes under $500,000, you’ll still see competition, so be ready to act.
If you’re a first-time home buyer in Turlock, this winter is a great time to get your financing lined up while the market is quiet. My Stanislaus and Merced County buyer’s guide covers down payment programs, loan types, and the step-by-step process.
Seller Strategy: Selling a Home in Winter 2026
Many homeowners assume they should wait until spring. Sometimes that’s right. But selling a home in winter has real advantages, and this real estate market forecast suggests spring 2027 may not bring the rate relief sellers are hoping for.
Why Winter Buyers Are Serious Buyers
People who tour homes in December aren’t browsing for fun. They’re relocating for work, facing a lease that’s ending, or growing their family. They want to close, and they’re less likely to waste your time.
You’ll also face less competition. When new listings dry up after Thanksgiving, a well-presented home stands out instead of getting lost in a crowded spring market.
Price It Right From Day One
This is the most important advice in this real estate market forecast for sellers. In Stanislaus County, homes priced correctly are still selling in about three weeks. Homes priced for last year’s market are sitting for months and eventually selling for less.
Start with an accurate number. My free Turlock home valuation uses recent closed sales, not online estimates, so you know exactly where your home fits before you list.
Use Credits as a Marketing Tool
With rates above 7%, offering a credit toward the buyer’s rate buydown can be more powerful than a price cut. A credit of 1% to 2% of the sale price can lower the buyer’s monthly payment enough to make your home the one that fits their budget.
We can even advertise the lower payment in the listing. That gets the attention of buyers who are shopping by monthly payment, which is most of them right now.
Keep Holiday Staging Simple
A little seasonal warmth helps, but skip heavy decorations that make rooms look smaller in photos. Clean, bright, and neutral still wins. If you’re wondering whether professional staging is worth it, read my breakdown of whether staging raises your sale price.
Real Estate Market Forecast Timing Tips for November and December
- List by early November to catch buyers before Thanksgiving week slows showings.
- Avoid launching during Thanksgiving or Christmas week unless you have a strong reason to.
- Plan your closing around the holidays. Lenders, title companies, and county offices run on reduced schedules in late December.
- If your listing expired this fall, don’t just relist it unchanged. Adjust price, photos, and marketing first.
Looking Ahead: Home Price Forecast 2027
The end of this year sets the stage for next year. According to Fannie Mae’s September numbers, the home price forecast 2027 calls for national appreciation of about 1.0%, with the 30-year rate averaging near 6.7% all year. Fannie also projects total home sales rising to about 4.88 million in 2027, up from 4.69 million this year.
For the Central Valley, my real estate market forecast tells a similar story: modest price growth, more inventory than the last few years, and buyers who continue to shop by monthly payment. The wild cards are inflation, energy prices, and how aggressive the Fed stays in 2027.
The bottom line of this real estate market forecast: waiting for a perfect market may cost you more than acting in a good one.
Real Estate Market Forecast FAQs
Will mortgage rates go down in November or December 2026?
Probably not by much, according to nearly every real estate market forecast. With the Fed raising rates and the 10-year Treasury yield above 5%, most forecasts call for rates near or above 7% through year-end. A sudden drop in inflation or a weaker jobs report could change that.
Is November a good time to buy a house in Turlock?
Yes, for prepared buyers. There’s less competition, sellers are more motivated, and you have more room to negotiate credits. The key is having your financing ready before you start touring.
Should I wait until spring 2027 to sell?
Only if your home needs work you can’t finish now. Otherwise, winter listings face less competition, and current forecasts don’t show meaningfully lower rates in spring.
Are home prices going to drop in Stanislaus County?
Prices are already slightly below last year, and I expect them to stay flat to a few percent lower through December. I don’t see signs of a major drop, because inventory remains moderate and local homes are still more affordable than most of California.
Ready to Make Your Move Before the New Year?
Every real estate market forecast is only as useful as the plan you build from it. Whether you’re buying your first home, upgrading, or selling a property in Turlock, Modesto, Patterson, Ceres, or Merced County, I’ll help you read the numbers for your specific neighborhood.
Reach out today or call me at 209-620-4142. Let’s talk about your goals and build a strategy that works in this market, not the one we wish we had.