2026 SWMI & National February Housing Market Showed lower sales, rising listing inventory, lower prices, and a drop in mortgage rate drop

“After a cold start in January for the SWMI housing market, February market activity did not defrost. The number of houses sold in February fell to 137 houses, the lowest
level since 2009. The inventory of houses for sale, selling prices, and the mortgage rate all dropped below those in February 2025. Selling prices peaked in February 2025 in the year-over-
year comparison that includes prices back to 2006,” stated Luke Jeffries, Association Executive, Southwestern Michigan Association of REALTORS ® , Inc.

Jeffries continued, “In February 2026, the market ended with an inventory of 634 houses for sale, down 9 percent from 699 houses for sale in February 2025. Homebuyers in Allegan, Berrien, Cass, and the westerly 2/3 of Van Buren counties were facing a 3.8-months supply of homes, up slightly from the 3.7 supply level in January 2026.”

The Freddie Mac mortgage rate in February was 5.98, down slightly from the January rate of 6.10, and down from the 6.15 rate in December 2025 for a 30-year conventional mortgage.

The number of houses sold in February 2026 decreased 10 percent from that sold in February 2025 (137 vs. 152). Year-to-date, the number of houses sold decreased 16 percent (272 vs. 325).

The average selling price at $338,348 in February 2026 dropped 19 percent from January 2026 ($418,285) and 18 percent from February 2025 ($410,203).

The February 2026 median selling price slipped 5 percent below that in February 2025 ($272,000 vs. $285,000). The median selling price in January 2026 was $270,000.

The median price is the price at which 50% of the homes sold were above that price, and 50% were below.

The total dollar volume with fewer sales decreased 20 percent to $108,987,203 from $135,435,416 in February 2025.

There were three bank-owned or foreclosed homes as a percentage of all transactions in February, or 2 percent of all closed transactions. The highest percentage in February was 75 percent in 2009.

Nationally:
Existing-home sales increased by 1.7% month-over-month in February, according to the National Association of REALTORS ® Existing-Home Sales Report. The report provides the real estate ecosystem—including agents, homebuyers, and sellers—with data on the level of home sales, price, and inventory.

Month-over-month sales rose in the Midwest, South, and West, and fell in the Northeast. Year- over-year sales rose in the South and fell in the Northeast, Midwest, and West.

Total existing-home sales, which were completed transactions that include single-family homes, townhomes, condominiums, and co-ops, increased 1.7% from month-over-month to a seasonally adjusted annual rate of 4.09 million in February. Year-over-year, sales decreased 1.4%.

“Housing affordability is improving, and consumers are responding,” said NAR Chief Economist Dr. Lawrence Yun. “Still, there is a long way to go to return to pre-pandemic levels of transaction activity. There are more than 6 million more jobs than in 2019, yet home sales per year are down by one million.”

“Despite the modest gain in home sales, actual housing demand remains muted relative to wage growth and job gains,” Yun continued. “Wage growth is now outpacing home price growth by almost four percentage points. Mortgage rates are also measurably lower compared to a year ago.”

The median existing-home price for all housing types in February was $398,000, up 0.3% from one year ago ($396,800). the 32nd consecutive month of year-over-year price increases.

In the Midwest, existing-home sales in February increased 1.1% in sales month-over-month to an annual rate of 940,000, down 4.1% year-over-year.

First-time buyers were responsible for 34% of sales in February, up from 31% in January and from a year ago.

Cash sales accounted for 31% of transactions in February, up from 27% a month ago and down from 32% in February 2025.

Individual investors or second-home buyers accounted for 16% of transactions, unchanged from last month and one year ago.

Total housing inventory registered at the end of February was 1.29 million units, up 2.4% from January and 4.9% from one year ago.

“Inventory is growing, but sluggishly,” he added. “If demand picks up notably in the coming months and outpaces supply growth, home prices will inevitably rise. That is why increasing
supply is so important to help limit home price growth, improve housing affordability, and boost transactions.”