Buffalo Housing Market Outlook, Interest Rates and What Buyers and Sellers Should Expect in the Next 6 to 12 Months
By Enas Latif | January 30, 2026
After two years of volatility, interest rates have finally found some footing. As we move into 2026, 30 year fixed mortgage rates are hovering in the low to mid 6 percent range, down from their recent highs.
While this is a noticeable shift from the ultra low rates of the pandemic era, economists largely agree on one thing. Rates are stabilizing, not surging, and that stability is reshaping housing decisions.
National Interest Rates and Market Direction
Nationally, the Federal Reserve has signaled a cautious path forward, with gradual rate reductions expected over the next 6 to 12 months as inflation continues to moderate. Forecasts from the National Association of Realtors and Fannie Mae suggest mortgage rates could ease slightly, potentially dipping into the high 5 percent range, but a return to 3 to 4 percent rates is unlikely in the near future. Today’s environment should be viewed less as temporary and more as a recalibration.
For the residential real estate market overall, this shift creates a healthier balance. Buyer demand, which softened under higher borrowing costs, is showing signs of renewed activity. Inventory is improving incrementally, and home prices nationwide are expected to grow modestly, roughly 1 to 3 percent annually, reflecting stabilization rather than speculation.
Buffalo Housing Market Conditions
Here in Buffalo and its surrounding suburbs, the market continues to outperform national trends. Limited housing supply, steady employment growth, and affordability relative to other U.S. metros have kept demand strong. Well priced homes are still selling quickly, often with multiple offers, and price growth is expected to remain positive through 2026, though at a more sustainable pace.
For buyers, waiting on significantly lower rates may mean facing higher home prices and increased competition. Those who are prepared and properly advised can still secure strong opportunities in today’s market.
Buyer and Seller Outlook in a Stabilizing Market
For sellers, leverage remains, but precision matters. Buyers are more payment conscious, making accurate pricing and strategic presentation essential to maximizing value.
The takeaway is clear. Buffalo’s housing market is not slowing, it is maturing. In a higher rate environment, experience, data, and local insight matter more than ever.
Planning Ahead for the Next 6 to 12 Months
If you are considering buying, selling, or simply want a clear, market specific strategy for the next 6 to 12 months, working with a local expert who understands both national trends and Buffalo’s neighborhood level dynamics is critical. I work closely with buyers and sellers across Buffalo and its suburbs to help them make informed, confident decisions, no guesswork, just smart strategy.
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