Four Years Into Higher Rates, the Housing Market Has New Rules
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Realtor.com® reports inventory up 142.1% since 2022, rates peaked at 7.79%, yet median list prices remain 8.1% higher as delistings surge.
Higher mortgage rates have reshaped the housing market.
That’s the headline from a new Realtor.com report looking back at four years of higher borrowing costs.
Since January 2022, active inventory has climbed 142.1%. At the same time, the median list price is still 8.1% higher and price per square foot has risen 11.4%. Rates peaked at 7.79% and now sit near 6.10%.
Buyers pulled back. Listings came back in many markets. Prices didn’t collapse.
More than 50% of homeowners are still locked into mortgage rates below 4%, which helps explain why so many sellers can afford to wait. Homes are sitting longer. And delistings have more than doubled as a share of active listings.
The housing “reset” a lot of folks were waiting for never showed up.
What we’re left with is a market operating under a different set of rules.
Here’s what the data say about how those rules are shaping inventory, pricing power, and seller behavior.
Rule #1: Inventory Can Rise Without Breaking Prices
Inventory has come back in a real way over the past four years. Active listings nationwide are up 142.1% since January 2022.
That’s a dramatic shift from the historic lows that defined the early part of this cycle.
The rebound hasn’t happened evenly, though. Active listings are up 213.7% in the South and 180.0% in the West. In the Midwest, inventory is up 67.1%. In the Northeast, it’s up 22.4%.
In high-growth metros like Dallas, Raleigh, Austin, Denver, Tampa, and Nashville, listings have surged more than 350%. Meanwhile, Chicago, Hartford, and New York have fewer active listings today than they did four years ago.
Local supply conditions look very different depending on where you stand.
The structure of that inventory has also changed. In January 2022, new listings made up 85.9% of active listings. By January 2026, that number had dropped to 36.1%.
And median days on market went up from 59 days to 78.
As Joel Berner explained in the report:
“This shift indicates that the rise in active inventory has been driven less by a steady stream of new sellers entering the market and more by homes remaining listed for longer periods. Sellers are patiently testing price levels and waiting for buyers, rather than pricing aggressively to move quickly.”
Inventory has grown, but a lot of that growth comes down to time. Homes aren’t flying off the market the way they were a few years ago. Sellers are listing, waiting, and seeing what happens.
That slower pace changes how deals come together and how much patience everyone needs to get one across the finish line.
Rule #2: Higher Rates Don’t Automatically Mean Lower Prices
A lot of people expected prices to give back more ground over the past four years. That hasn’t happened.
Since January 2022, the national median list price is still up 8.1%. Price per square foot has climbed 11.4%. Mortgage rates jumped. Inventory expanded in many markets.
Even with those pressures, prices never rolled over in a broad way.
The regional numbers show how durable pricing has been. Median list prices are up 22.0% in the Midwest and 15.3% in the Northeast. In the South, they’re up 7.4%. In the West, 2.2%. Some markets cooled. Most held their ground.
Across the top 50 markets, 42 are still above their January 2022 price per square foot levels.
Leading the metros with the biggest increases in list price per square foot:
Cleveland, OH: 34.8%
Milwaukee, WI: 34.0%
Buffalo, NY: 26.5%
Providence, RI-MA: 23.9% (Tie)
Virginia Beach, VA: 23.9% (Tie)
Hartford, CT: 23.0%
Grand Rapids, MI: 22.6%
Indianapolis, IN: 21.5%
Richmond, VA: 20.6%
New York, NY: 19.2%
Only eight major metros have seen declines over that stretch.
San Francisco (-13.4%)
Austin (-11.4%)
Denver (-6.6%)
San Jose (-5.7%)
San Antonio (-5.0%)
Washington, D.C. (-0.8%)
Sacramento (-0.6%)
Miami (-0.3%)
Joel Berner explained it this way:
“What we’ve learned is that the laws of supply and demand still apply, but the relationship has weakened. Even a flood of listings and much higher financing costs weren’t enough to generate broad-based price relief.”
Higher rates slowed buyers down. They didn’t erase the run-up in values. Sellers made some adjustments around the edges, but the kind of reset many people were waiting for never showed up.
Rule #3: Sellers With Equity Can Afford to Wait
The bigger story here is how sellers are reacting once their homes hit the market.
Back in January 2022, delistings accounted for 3.1% of active listings. By January 2026, that number had risen to 7.0%. As a share of new listings, delistings climbed from 8.4% to 32.0%.
You can feel the difference in how the market moves. More homeowners are comfortable pulling a listing if the offers don’t line up with their expectations. They step back, wait, and try again later.
Joel Berner summed it up like this:
“In many cases, delisting reflects not seller distress but privilege, where today’s homeowners sit on historically high levels of home equity and a strong majority have low fixed mortgage rates. That combination gives sellers flexibility and the luxury to list, delist, repeat until they get their price. As a result, rather than clearing, the market has a tendency to stall out.”
Plenty of sellers are sitting on equity and low fixed rates. That gives them breathing room. They don’t have to cut quickly. They can test the waters and pull back if it doesn’t work.
That kind of behavior keeps homes cycling through the system and stretches out the timeline for getting deals done.
Rule #4: Rate Lock Is the Gatekeeper
Mortgage rates hit 7.79% at the peak of this cycle and now hover around 6.10%. That move changed how buyers shop and how homeowners think about moving.
More than half of current borrowers are sitting on rates below 4%. For a lot of them, selling means giving up a payment they may never see again. That’s a tough trade to make, even if they want a different house.
Joel Berner described the tension clearly:
“That’s the tension in today’s market. Lower rates could unlock more supply, but they could also bring buyers back faster than listings recover. The path to meaningful affordability relief depends on supply growing sustainably—not just demand returning.”
If rates come down, more sellers might finally list. More buyers would likely jump back in at the same time.
How those two forces balance out will shape what the next phase of this market looks like.
What These Rules Mean
This market takes more work than it used to.
Homes are selling, but they’re not flying off the shelf. Buyers are watching their monthly payment closely. Sellers know what they have and aren’t quick to panic. Every deal feels more deliberate.
Joel Berner put it plainly:
“Four years into this higher-rate environment, it’s clear that the housing market recalibrated rather than reset. Supply and demand moved in the directions economic theory would suggest, but prices proved far more resilient than many anticipated, leaving today’s affordability challenges firmly in place.”
These are the new rules of the housing market.
Inventory can grow without triggering a price drop.
Sellers with equity and low rates can wait.
Buyers step in when the payment works.
Getting a deal across the finish line takes tighter pricing and cleaner execution than it used to.
Key Details:
Realtor.com reports active inventory up 142.1% since January 2022, while the median list price remains 8.1% higher and price per square foot has climbed 11.4%.
Mortgage rates peaked at 7.79% and now sit near 6.10%, with more than 50% of borrowers still holding rates below 4%.
Delistings rose to 7.0% of active listings and 32.0% of new listings.
Housing Market - February 23, 2026 - Sarah Lentz
https://nowbam.com/four-years-into-higher-rates-the-housing-market-has-new-rules/
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