As we look ahead to 2026, buyers and sellers across Palm Beach County are watching two major trends:
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Where mortgage rates will land
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How home prices are expected to shift
These factors directly influence buying power, affordability, and equity. Recent forecasts from Fannie Mae and Zillow give us a clearer picture of what to expect in 2026—and what those changes mean for communities such as Boca Raton, Jupiter, Wellington, Palm Beach Gardens, Westlake, and Loxahatchee.
2026 Mortgage Rate Outlook
Fannie Mae Forecast
Fannie Mae projects mortgage rates will trend downward into 2026, potentially dipping below 6% by late 2026.
Zillow Forecast
Zillow’s forecast suggests that while rates may improve, they might not fall meaningfully below 6%, creating a new normal of mid-6% mortgage rates.
Source:
https://www.zillow.com/research/2026-housing-predictions-35800/
Local Impact
A shift toward 6% still benefits buyers, but it may also increase competition—especially in high-demand areas like Boca Raton and Jupiter where inventory has remained tight.
Home Price Expectations for 2026
Zillow’s national outlook suggests:
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Continued home price growth
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More inventory, but still below pre-pandemic levels
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Demand rising again as rates stabilize
Applying this to Palm Beach County’s high-demand, lifestyle-driven market, a 3%–6% price increase is a realistic expectation in 2026.
Communities likely to outperform include:
Demand for new construction and larger lots continues to push buyers toward Westlake and Loxahatchee, while Jupiter, Boca Raton, and Palm Beach Gardens maintain strong luxury appeal.
Why Rates and Prices Matter for Affordability
Many buyers focus only on the interest rate—but prices matter just as much.
Even small price increases can erase the savings from a rate drop.
Here’s a clear example.
Payment Difference Using 7% as the Baseline Rate
Loan Amount: $600,000 – Principal & Interest Only
| Mortgage Rate | Monthly Payment | Difference vs. 7% |
|---|---|---|
| 7.00% | $3,991 | Baseline |
| 6.50% | $3,792 | –$199 |
| 6.20% | $3,682 | –$309 |
| 6.00% | $3,597 | –$394 |
| 5.75% | $3,501 | –$490 |
A drop from 7% to today’s 6.2% range saves more than $300/month.
But now look at the effect when prices rise.
If Rates Fall but Prices Rise (Home Price: $600,000)
6.20% today vs. waiting for 6.00%
| Scenario | Home Price | Rate | Monthly Payment | Result |
|---|---|---|---|---|
| Buy Today | $600,000 | 6.20% | $3,682 | Baseline |
| Wait – Prices +3% | $618,000 | 6.00% | $3,702 | Slightly higher |
| Wait – Prices +5% | $630,000 | 6.00% | $3,776 | Higher payment |
| Wait – Prices +6% | $636,000 | 6.00% | $3,812 | Highest payment |
Key takeaway:
If home prices rise just 3%–6%, waiting can result in a higher monthly payment—even with a better rate.
This pattern is especially common in appreciation-strong communities like Jupiter, Boca Raton, and Palm Beach Gardens.
What This Means for Buyers in 2026
✔ Buying sooner may save money
A small rate drop can’t always offset the impact of rising prices.
✔ Inventory will improve, but demand will too
Especially in family-focused areas such as Wellington, Westlake, and Loxahatchee.
✔ Refinancing remains a strong strategy
Buyers can purchase now and refinance later if rates improve in late 2026.
✔ Your ideal home may appreciate faster than rates fall
Especially in Jupiter, Palm Beach Gardens, and Boca Raton.
What This Means for Sellers in 2026
✔ Equity will continue to grow
Projected appreciation supports strong home values.
✔ Buyer demand remains steady
Lifestyle relocations, second-home buyers, and local movers continue to drive demand.
✔ Well-presented homes will stand out
Updated and move-in-ready homes perform best across Palm Beach County.
✔ Pricing strategy matters
Correct pricing—and proper marketing—can attract multiple qualified buyers in a stabilizing market.
Final Thoughts: A Balanced Market with Opportunity for Both Sides
Based on all current forecasts, 2026 will be a healthy, stable real estate year for Palm Beach County:
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Mortgage rates near 6%
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Prices rising 3%–6%
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Steady demand across price points
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Strong performance in communities like
Boca Raton,
Jupiter,
Wellington,
Palm Beach Gardens,
Westlake, and
Loxahatchee.
Whether you're thinking about buying or selling, timing matters—and understanding how rates and prices interact will help you make a more confident decision.
If you'd like a personalized breakdown of your buying power or home value going into 2026, I’m here to help.
