Homebuying power jumps to the highest level in 4 years

The power shift

Spring is almost here — and buyers are walking into the strongest position they’ve had in four years.

Homebuying power has climbed to its highest level since March 2022. At the same time, inventory continues to tilt in buyers’ favor: there are now 44% more sellers than buyers in the market. That’s up from a 30% surplus a year ago and represents the second-largest gap on record, dating back to 2013.

Mortgage rates are helping too. This week, rates dipped to 5.99%. Whether sub-6% sticks is anyone’s guess — the last time it happened, it lasted less than a day — but zoom out, and the message is clear: buyers have more leverage today than they’ve had in years.

In today’s Blueprint, we break all this down and explain what it means.   

Before we jump in, though, a quick personal note. We missed Tuesday’s edition due to some technical hiccups, and so many of you reached out to check in. That genuinely meant a lot. Hearing from you warmed our hearts. Thank you for being here. Truly.

Sharing our thoughts with you is a privilege we never take for granted. :)  

Going forward, we’re back on our regular Tuesday and Friday schedule.

Now, let’s dive in!

- David

Homebuyer power surges by $30K

Heading into spring, U.S. homebuyers are seeing a sharp spike in buying power. According to Zillow, a median-income household can now afford a $331,483 home, up $30,302 from $301,181 a year ago, marking the strongest affordability level since March 2022. At the same time, Redfin reports there are 600,314 more sellers than buyers nationwide — a 44% gap — creating one of the most buyer-friendly conditions in years.

Here are the facts to know:

• Buying power rebound: Rates have fallen from 6.96% last January to 6.1% (and recently dipped to 5.99%). That’s cut the typical mortgage payment by 8.4% YoY. Buying power is now well above the October 2023 low, when it bottomed at $272,224.

• More homes within reach: Buyers can now afford 446,982 listings nationwide, up from 364,688 last year. Affordable homes now make up 40.3% of the market, compared to 34.8% a year ago.

• Supply-demand imbalance: There are 1.96 million sellers versus 1.36 million buyers — the second-largest gap on record. Buyer demand is down 8% YoY and at the lowest level ever recorded.

• Expensive markets see the biggest swings: In high-cost metros, small rate moves create big swings. San Jose buyers gained $74K in purchasing power year over year. San Francisco (+$56K), D.C. (+$49K), San Diego (+$47K), and Boston (+$46K) saw similar jumps.

• Sun Belt inventory surge: Houston, Phoenix, Dallas, Miami, and Atlanta all added thousands of homes to the “affordable” category. Many of these markets are also among the strongest buyer’s markets in the country.

• Price growth cooling: In 39 buyer’s markets, prices rose just 1% YoY, compared to 5% in the few remaining seller’s markets, meaning buyers are gaining ground without a wave of bidding wars returning.

My take

The real shift isn’t just that buyers can afford a $30,000 more house, it’s that they’re doing so in a market where leverage has flipped. There are 600,000 more sellers than buyers, and prices are up just 1% across most buyer’s markets, so affordability gains aren’t getting competed away. That’s a rare alignment: better math without bidding wars coming back. The issue now is perception. Many buyers don’t realize how much negotiating power they actually have. So, now is the time for agents to make that leverage clear and put it to work before conditions shift again. Spark some urgency among your buyers.

Markets where home prices have fallen the most

U.S. home prices rose just +0.2% year-over-year between January 2025 and January 2026, according to ResiClub’s analysis of the Zillow Home Value Index. Essentially, national home prices were flat.

While prices are still inching higher in inventory-constrained regions like parts of the Northeast and Midwest, softness is far more visible elsewhere. Among the 300 largest metro areas, 100 markets (33%) posted year-over-year price declines between January 2025 and January 2026.

The deepest pullbacks are concentrated in Sun Belt and Gulf Coast markets — many of which experienced the sharpest pandemic-era run-ups and now face elevated resale inventory and heavy new-home competition.

Here are the top 10 markets where home prices fell the most:

1. Punta Gorda, FL: -11.93%

2. Cape Coral, FL: -9.19%

3. Sarasota, FL: -7.54%

4. Kahului, HI: -5.99%

5. Naples, FL: -5.97%

6. Austin, TX: -5.87%

7. Houma, LA: -5.45%

8. Vero Beach, FL: -4.83%

9. Tampa, FL: -4.78%

10. Pompano Beach, FL: -4.27%

My take

This isn’t a broad national correction — it’s a split market. National prices are barely moving, but about one-third of major metros are still posting declines, concentrated in pandemic boom markets across the Sun Belt and Gulf Coast, where inventory has normalized faster, and new construction is competing hard with resales. That said, the deterioration isn’t accelerating. After climbing through the first half of 2025, the share of markets with year-over-year declines has largely stabilized over the past seven months. In other words, weakness remains concentrated, but it’s no longer spreading.

Metros with the highest share of homeowners underwater

As of December 2025, 2.1% of U.S. mortgage holders had negative equity, according to data from ResiClub and ICE Mortgage Technology (formerly Black Knight). That’s up from 1.3% in December 2024, but still dramatically below the 23.0% peak in September 2009 during the housing bust.

Negative equity — commonly referred to as being “underwater” — means a homeowner owes more on their mortgage than the home’s current market value.

Among the 100 largest metros, the following markets have the highest share of underwater mortgages:

1. Lakeland-Winter Haven, FL: 10.8%

2. Cape Coral-Fort Myers, FL: 10.1%

3. Austin-Round Rock-Georgetown, TX: 9.2%

4. San Antonio-New Braunfels, TX: 8.8%

5. Jacksonville, FL: 6.3%

6. North Port-Sarasota-Bradenton, FL: 6.0%

7. Colorado Springs, CO: 5.6%

8. Tampa-St. Petersburg-Clearwater, FL: 5.4%

9. Baton Rouge, LA: 3.8%

10. Deltona-Daytona Beach-Ormond Beach, FL: 3.7%

My take

Yes, the share of underwater homeowners has ticked up — from 1.3% to 2.1% — but this isn’t 2009 all over again. The stress is mostly concentrated in a handful of pandemic boom markets like San Antonio and Cape Coral, and largely among recent buyers. Nationally, prices are still near peak levels, and more than half of homeowners are sitting on sub-4% mortgages that have helped them build meaningful equity cushions. This is more of a regional giveback after an overheated run — not systemic trouble.

Schematics

The news that just missed the cut

• This is the best listing appointment tool we’ve seen

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• Do this to put yourself in control of your spring pipeline

• Why Japanese firms are buying even more U.S. homebuilders

• How real estate investors are using AI to get early market signals

Foundation Plans

Advice from David to win the day

This is a story we like to tell all new agents. Michael Jordan joined the NBA in 1984 but didn’t win his first championship until 1991. Through those seven years, he won a lot of individual accolades, but he never even got to the finals. He only won when he surrounded himself with a reliable crew that complemented his skills. He finally got the right system and the right people around him.

Like basketball, real estate isn’t a one-person show. It’s a team effort. Even if you’re individually great, you’ll never take your business to the next level until you surround yourself with the best people possible.

This isn’t a full list, but here are some key players that every agent needs:

Lenders: Finance is a huge part of our business. No deal is going to get done unless your clients can finance their home. Having a go-to set of lenders allows you to know your client is in good hands. It also allows you to provide the level of service you want to your clients.

Title Company/Closing Attorney: Transactions are the most volatile during closing. By having a trusted attorney or title company, you can prevent issues and ensure the closing process goes smoothly. You may not deal with many attorneys in your market, especially if you’re in the Central US or on the West Coast, but on the East Coast, most closings are handled by attorneys. 

Dependable “Handymen” or Service Workers: This is often overlooked, but you need to know a reliable set of handymen or service workers of all stripes (A/C, cleaning, gardens, etc.). When a buyer gets a new home, they may need repair work done. You can be their guide and go-to resource. That builds trust. Trust builds repeat business and referrals. A strong vendor network turns a single transaction into a long-term relationship.

We don’t intend this to be an exhaustive list. It’s just a reminder: Your production ceiling is tied to the quality of the people around you. Individual talent gets you started. Infrastructure wins championships.

Take a hard look at your network and ecosystem. Upgrade at least one relationship this quarter.

Just in Case

Keep the latest industry data in your back pocket with today’s mortgage rates:

“Your time is limited, so don’t waste it living someone else’s life.” — Steve Jobs

Each day is a gift – a chance to live the life you want. Ruthlessly focus on your goals. Don’t let your past or the fear of being judged distract or paralyze you. Choose to live with an integrity that you can be proud of.

- David