Each week, I analyze the evolving dynamics of the market, identifying emerging trends, shifts in momentum, and key considerations for real estate professionals. Last week’s economic data painted a picture of steady progress, even as housing remains constrained by long-standing supply challenges and affordability concerns persist. Inflation continued to ease, now well below its 2022 peak, and January’s job report exceeded expectations, with employment gains nearly matching the total number of jobs created in all of 2025. Policymakers are also taking steps aimed at addressing the nation’s chronic housing shortage. While January’s decline in mortgage rates pushed housing affordability to a four-year high, the day-to-day reality for buyers and sellers is still shaped by limited inventory, ongoing affordability pressures, and mortgage rates that have stabilized within a narrow band in the low-6 percent range. Together, these dynamics point to a market defined by gradual, incremental improvement rather than dramatic shifts.
February 17, 2026
INFLATION EASED IN JANUARY. January inflation cooled to an eight-month low, with core CPI rising 2.5% year-over-year. Goods’ inflation continued to soften, reflecting improved supply chains and moderating demand. However, rising shelter costs, which account for more than 40% of core inflation, remained the largest contributor to the increase. Tariffs and elevated services costs continue to put upward pressure on certain categories, but the broader disinflation trend remains intact. Full story from EYEONHOUSING →
- Why this Matters: Cooling inflation keeps the Fed on track toward eventual rate cuts, but the stickiness of shelter costs underscores the structural imbalance in housing. Until supply expands meaningfully, housing will continue to exert upward pressure on inflation and limit how quickly affordability can improve. For the real estate market, this means progress will come—but not all at once.
U.S. HOUSE PASSES HOUSING FOR THE 21ST CENTURY ACT. The House passed the Housing for the 21st Century Act with overwhelming bipartisan support (390–9). The legislation aims to address the nation’s chronic housing shortage by modernizing federal housing programs, reducing regulatory barriers, and supporting zoning reforms. Key provisions include updates to the HOME program, incentives for localities to expand housing supply, and measures to support manufactured housing as an affordable option. Full story from HOUSINGWIRE→
- Why this Matters: While legislation alone won’t solve the inventory shortage, this bill represents a moment of alignment in Washington around the urgency of expanding housing supply. It signals growing recognition that affordability challenges are structural, not cyclical, and that long-term solutions require coordinated policy action. For the industry, it’s a positive step toward unlocking more pathways to build additional housing.
EXISTING HOME SALES RETREAT AMID LOW INVENTORY. Existing home sales declined sharply in January, falling to a two-year low after December’s brief rebound. Inventory remains the defining constraint: while listings are up modestly year-over-year, they remain far below balanced-market levels. Homes are taking slightly longer to sell, with days on market rising to 46, yet prices continue their 31-month streak of annual gains, a sign that demand still exceeds supply. Full story from EYEONHOUSING →
- Why it Matters: The market continues to be shaped by scarcity. Buyers are ready, but options remain limited, and that imbalance keeps prices elevated even as sales volumes soften. For real estate professionals, this environment requires proactive buyer education, strong search strategies, and early preparation so clients can move quickly when the right home appears.
JANUARY JOBS DATA BEATS ESTIMATES. January’s jobs report exceeded expectations. But despite the favorable data, mortgage rates showed little reaction. Markets are increasingly focused on the broader inflation trajectory and the Fed’s long-term path rather than reacting to individual data points. As a result, rates remain range-bound, awaiting clearer evidence that inflation is sustainably returning to target. Full story from HOUSINGWIRE →
- Why it Matters: A resilient job market supports consumer confidence and household formation, both essential for housing demand. But until inflation cools further, mortgage rates are unlikely to move dramatically. This creates a window where buyers who are prepared and flexible can find opportunities, even in a tight market.
THE BOTTOM LINE: The economy continues to show steady progress, but housing remains constrained by long-standing supply challenges that keep prices elevated and limit mobility. Inflation is easing, job growth exceeded expectations to begin the new year, and policymakers are taking steps to expand housing supply—all encouraging signs for the year ahead. Yet the near-term market will continue to reward preparedness, education, and strategic decision-making. For agents and consumers alike, this is a moment to stay engaged, stay informed, and be ready to act when opportunity arises.
Disclaimer: this is a compilation of industry news from trade media and industry groups; it does not share any forward-looking predictions or projections.
