Home sales are expected to strengthen modestly as lower mortgage rates and improving affordability encourage more buyers to re-enter the market.

• Home prices should continue rising at a measured pace, supported by limited inventory despite ongoing affordability and insurance challenges.

• Inventory is projected to improve gradually, giving buyers more negotiating power while reducing the intensity of bidding wars.

• Economic uncertainty remains a headwind, but California is expected to finish 2026 with moderate sales growth and stable market conditions.