The U.S. housing market is building “significant” pent-up demand that could be released if mortgage rates ease, inventory improves and consumer confidence rebounds, National Association of Realtors’ (NAR) chief economist Lawrence Yun told attendees Friday at NAR’s NXT in New Orleans.
Yun contrasted today’s sales environment with the year 2000, noting that the U.S. population has grown from 281 million to 350 million and payroll jobs from 132 million to 159 million over that period. Housing wealth has ballooned from $7 trillion to $35 trillion, yet existing-home sales are tracking near 4 million this year, well below the 5.2 million homes sold in 2000, he said, citing NAR data.
“Affordability is tough, but people’s incomes are rising, and if somehow mortgage rates go down, think about the potential housing demand that could be released to the marketplace,” Yun said.
On the supply side, Yun said inventory has risen as sales have slowed. Months’ supply is now at its highest level since 2015, and the median home took 33 days to go from listing to contract in September, according to NAR.
“Homes are staying on the market a little longer than before,” Yun said. “With longer days on market, you have to be realistic to the market condition. Otherwise, buyers will reject the homes on the market.”
Yun pointed to consumer psychology as a key missing ingredient. Consumer sentiment has fallen to roughly half its 2000 level and is now worse than during the Great Recession, even as the labor market has added jobs.
“If we can boost confidence levels, maybe that can also change the dynamics,” Yun said.
First-time buyers remain near historic lows
Jessica Lautz, NAR deputy chief economist and vice president of research, presented findings from the trade group’s newly released 2026 Profile of Home Buyers and Sellers. First-time buyers made up 22% of all buyers, near the series low, and the median age of first-time buyers held at a record-high 40.
Those numbers underscore how younger households are delaying homeownership, even as they form households and enter peak earning years. For lenders and real estate brokerages, that means fewer entry-level transactions and more emphasis on move-up or equity-rich buyers.
“First-time home buyers are struggling,” Lautz said. “They’re not struggling just with housing affordability. They’re also struggling with rent. They’re struggling with student loan debt, and a rising issue for first-time home buyers is childcare costs.”
Lautz noted that sellers reported staying in their homes for a median of 12 years before selling, the longest tenure on record for the survey.
“The golden handcuffs of low interest rate mortgages is true. People are holding on to those properties for longer periods of time,” she said. “It’s why we need to build more housing inventory—especially affordable housing inventory—for the potential first-time home buyers who are out there.”
Agent usage hits record highs
Despite technology and direct-to-consumer platforms, use of licensed professionals in transactions remained strong, according to NAR’s survey. A reported 90% of buyers purchased through an agent, the highest share in four decades, and a record 92% of sellers used an agent.
“Sellers want agents to price that home competitively, find that qualified buyer, help with marketing, and make sure they get to the closing table in a time frame that they need to do so,” Lautz said.
Why this matters for housing professionals
For real estate agents and brokers, NAR’s data point to a market where transaction volume is constrained more by affordability, rates and sentiment than by underlying demand. A larger population, more jobs and higher housing wealth suggest that activity could accelerate quickly if mortgage rates retreat and confidence improves.
For lenders, a 22% first-time buyer share and a median first-time buyer age of 40 highlight both near-term headwinds and an eventual backlog of delayed demand. Households that are renting longer and juggling student debt and childcare may respond strongly to any easing in rates, pricing or down payment constraints.
For builders and developers, Lautz’s comments reinforce the policy and business case for adding affordable inventory. With existing owners locked in by sub-4% mortgages and staying put for a median 12 years, new construction remains one of the few levers to ease the entry-level shortage.
Yun’s and Lautz’s remarks come as the industry also adjusts to post-settlement commission rule changes and elevated borrowing costs, making accurate pricing, counseling on affordability and clear communication with consumers more central to winning business in 2027 and beyond.
This article was generated using HousingWire Automation and reviewed by a HousingWire editor before publication.
