Housing Market Update – July 2, 2026

If you’re buying, selling, or refinancing in Washington, Oregon, Idaho, California, or Colorado, here’s what the market looks like right now – at the state and county level. These are the five states where we focus our lending, and conditions vary meaningfully between them. We’ve pulled the most current data available as of July 2, 2026, so you have a clear picture of where things stand in your specific market.

Washington

Washington’s housing market continued its gradual shift toward more balanced conditions through May 2026, with the latest NWMLS data showing inventory at its highest point of the year so far. Active listings statewide reached 21,381 homes in May, up 16.8% year-over-year and 15.2% from April, giving buyers access to nearly 2,800 more homes than the prior month. Despite that inventory growth, prices have remained remarkably stable.

The statewide median held at $650,000 for the second consecutive month, essentially flat year-over-year, while closed sales rose 9.5% month-over-month as the spring season gained momentum. Months of supply edged up to 3.44, continuing a gradual drift toward a more balanced market without crossing into buyer’s-market territory.

At the county level, King County’s median came in at $875,000 in May, up 1.2% year-over-year, holding firm despite a 3.4-month inventory reading that is up from 2.8 months a year ago. Snohomish County saw active listings jump 33.6% year-over-year, with a median of $759,875 and 2.7 months of supply. Pierce County active listings grew 20%, with a steady median of $580,000 and 2.8 months of supply. The pattern across all three is consistent: more selection for buyers, but no meaningful price erosion. That said, the latest S&P Cotality Case-Shiller data released this week shows Seattle posting a -2.3% year-over-year price decline in April, the weakest reading of any major U.S. city, which reflects the broader pressure on Western markets from elevated mortgage rates. Buyers with flexibility on location continue to find their best opportunities in Pierce and Spokane counties, where affordability is stronger and competition is more measured.

County-level indicators for Washington, including median price, price per square foot, 1- and 5-year forecasted appreciation, household formations, homes being built versus demand, and the share of renters who can afford to buy, are shown in the tables below.

* Which means over 10,000 more homes need to be built annually to keep up with demand

* Which means over 6,000 more homes need to be built annually to keep up with demand

* Which means over 5,000 more homes need to be built annually to keep up with demand

* Which means almost 2,000 more homes need to be built annually to keep up with demand

Oregon

Oregon continues operating in a balanced housing market in 2026. The state has surpassed pre-pandemic 2019 active inventory levels, giving buyers meaningfully more selection than in recent years. The statewide median for single-family homes is approximately $472,000 as of May 2026, with the Portland metro running between $508,000 and $549,000 and appreciation near flat to slightly positive at 1–2% annually.

Days on market have lengthened to around 46 days statewide, up two days from a year ago, and homes are selling at approximately 99% of list price. With around 4.2 months of supply, the market is functioning more like a balanced environment than the seller’s market Oregon experienced in 2021–2023.

Buyers are finding the most flexibility in the Portland suburbs, while Bend continues to command a premium above $600,000, driven by remote-work demand and outdoor recreation appeal.

* Which means over 6,000 more homes need to be built annually to keep up with demand

Idaho

Idaho’s housing market continues its gradual rebalancing in 2026. The state has returned to pre-pandemic inventory levels, a significant shift from the severely supply-constrained conditions of the 2021–2023 boom. Statewide median sale prices remain modestly below year-ago levels, while sales volume continues to recover as buyers re-enter a market that now offers more choice.

Boise’s median sits near $495,000, essentially flat from a year ago. With homes spending an average of 68 days on market and only about 14% selling above list price, buyers have meaningfully more negotiating leverage in Idaho than anywhere else in the five states we lend in. Ada County remains the most active market, and is one of the few areas in the country where new construction is outpacing demand, a true surplus that is helping keep prices in check.

* Which means there is a surplus of over 2,000 more homes being built annually vs. demand

California

California’s housing market set a new price record in May 2026, with the California Association of Realtors reporting the statewide median home price hit $930,260 – a new all-time high for the second consecutive month, up 3.1% from May 2025. Existing single-family home sales rose 5.1% year-over-year, though they pulled back 3.1% from April as seasonality and affordability continued to limit activity. The persistent tension in California’s market remains the same: enormous long-term demand, constrained supply driven by the rate lock-in effect (approximately 77% of California homeowners hold mortgage rates below 5%), and an affordability ceiling that keeps only about 18% of households able to afford the median-priced home. New home sales in the West declined sharply in May, a reversal from April’s strong regional performance, as higher rates weighed on builder-contract signings. With the Iran peace deal now formally signed and oil below $70, California buyers may get some modest relief on rates in the weeks ahead, which could help unlock additional demand as the summer selling season continues.

* Which means over 1,500 more homes need to be built annually to keep up with demand

* Which means over 4,000 more homes need to be built annually to keep up with demand

Colorado

Colorado’s housing market continues its methodical rebalancing in 2026. Active listings in the Denver metro remain well above year-ago levels, giving buyers the most selection they’ve had in years. The statewide median has softened modestly from prior-year levels, though the Denver metro median has held steadier near $575,000. Sales activity has been recovering: Denver metro closed sales and pending contracts have both shown positive year-over-year trends in recent months, a sign that buyers are slowly returning as inventory improves and affordability stabilizes. Homes are spending an average of 56 days on the market in Denver. Colorado Springs continues to offer some of the most buyer-friendly negotiating conditions in the state. The Case-Shiller April data released this week showed Denver down 1.8% year-over-year, one of the weaker readings nationally, reflecting the same rate-driven affordability pressure visible in the transaction data. The sharp decline in new home starts reported two weeks ago (down 15.4% in May) is particularly relevant for Colorado’s front range communities: fewer starts today means tighter supply conditions in 12–18 months, which will provide a floor under prices even as the current market continues to favor buyers.

* Which means over 2,500 more homes need to be built annually to keep up with demand

National Home Data

For a broader context on what’s driving mortgage rates, builder activity, and buyer sentiment across the country, here is a summary of the major national housing reports released this week.

The S&P Cotality Case-Shiller Home Price Index for April 2026 (released June 30, 2026) showed the national index up 0.8% year-over-year – a modest improvement from March’s 0.7% pace and the first acceleration since November 2025. On a seasonally adjusted monthly basis, however, prices fell 0.1% in April, the second consecutive monthly decline. For the 11th straight month, inflation outpaced home price growth: with headline PCE running at 3.8% in April, real inflation-adjusted housing wealth fell again. The regional divergence remains stark – Chicago led all markets with a 6.5% annual gain, followed by New York (+3.8%) and Cleveland (+3.2%), while Seattle posted the steepest decline at -2.3% year-over-year. Denver (-1.8%), Tampa (-1.8%), Dallas (-1.6%), and Phoenix (-1.7%) also fell. Nicholas Godec of S&P summarized it succinctly: “After dipping below 6% earlier this year, 30-year mortgage rates climbed back to 6.3% in April, keeping financing costs elevated. In this higher-rate environment, home price growth remains constrained, with housing largely treading water in nominal terms and falling in real terms.” The April data covering both the FHFA Mountain division and the broader national trend will be updated when the FHFA releases its monthly HPI report later this month.

Mortgage Rates: Freddie Mac’s Primary Mortgage Market Survey released June 25, 2026, put the 30-year fixed at 6.49%, up 2 basis points from 6.47% the prior week but down from 6.77% a year ago. The 15-year fixed averaged 5.84%. Freddie Mac Chief Economist Sam Khater noted that rates “have remained relatively stable over the last six weeks,” while purchase activity has eased modestly and refinance activity has continued picking up. As of today, the formal signing of the Iran peace deal on Friday and the subsequent drop in oil below $70 a barrel have pushed the 10-year Treasury yield to its lowest level in over six weeks – around 4.40% – and markets are watching closely to see whether that translates into a lower PMMS reading next Thursday. Most major forecasts continue to project the 30-year fixed remaining above 6% through the remainder of 2026, with MBA’s baseline centering around 6.5%, though the peace deal gives that forecast its first meaningful downside risk in several months.

New Home Sales (released June 24, 2026) fell for the second consecutive month, dropping 7.3% to a seasonally adjusted annual rate of 580,000 – the lowest level since January and 6.8% below May 2025. Sales plunged in the West to a seven-month low – a direct reversal of April’s strong Western performance. The median new home price was $424,900, essentially unchanged from a year ago, as builders absorbed pressure through incentives rather than price cuts. New home supply climbed to 10.3 months – the highest since 2009 – which will continue limiting new groundbreaking activity. Congress passed a housing affordability bill this week restricting Wall Street ownership of single-family homes and fast-tracking environmental reviews for new construction, though economists noted the bill stops well short of addressing the structural shortfall.

Existing Home Sales (released June 9, 2026) rose 3.2% month-over-month and year-over-year to a seasonally adjusted annual rate of 4.17 million units – the highest since December 2025. Total housing inventory reached 1.5 million units, representing 4.5 months of supply. The median existing-home price rose to $429,300, up 1.3% year-over-year – the 35th consecutive month of year-over-year price increases. NAR Chief Economist Lawrence Yun noted: “More Americans are on the move, with home sales rising to the highest level since December. Improving affordability is helping drive this momentum. Even with mortgage rates ticking up compared to earlier in the year, they remain lower than a year ago and are essentially at the long-term historical average.” The Housing Affordability Index rose to 105.6, up from 97.5 a year ago.

Pending Home Sales (released June 17, 2026) jumped 3.8% month-over-month and 4.8% year-over-year, with gains across all four regions – a strong forward-looking signal for June existing home sales, due July 9. NAR’s Yun described it as “a late spring buyer rush,” noting that buyers’ acceptance of above-6% rates as the new normal is driving the improvement rather than any rate relief.

Housing Starts (released June 16, 2026) fell sharply, dropping 15.4% month-over-month to a seasonally adjusted annual rate of 1.177 million, the lowest since May 2020 and well below the market forecast of 1.43 million. Single-family starts slipped 1.9% to 882,000, an eight-month low, while multifamily starts plunged 41.6% to 284,000. Construction activity fell in the South (-17.0%), West (-17.2%), and Northeast (-26.8%), while the Midwest posted a 3.7% gain. Single-family permits edged up 0.6% to 886,000. The sharp drop confirms that builders are pulling back on spec construction in the face of elevated rates and a 10+ month supply of unsold new homes. Fewer starts today will constrain new home inventory in 2027, continuing to provide a floor under prices across all five of our lending states.

The overall picture as of July 2, 2026, is a market beginning to respond to a major geopolitical shift. The Iran peace deal signed Friday removes the most significant rate headwind of 2026, the oil-driven inflation surge that pushed mortgage rates roughly 50 basis points above their late-February levels. How quickly that relief flows through to the 30-year fixed rate depends on whether the peace holds, how fast oil production normalizes through the Strait, and whether June inflation data confirms the plateauing trend suggested by May’s in-line PCE print. On the demand side, buyers have already demonstrated that they’re willing to act at these rate levels; the May existing and pending home sales numbers proved that. Any meaningful rate improvement from here could accelerate that activity meaningfully, particularly in inventory-rich markets like Idaho, Colorado, and suburban Washington.