Ready to Buy in 2026? Why This May Be the Best Time in 3 Years

Well, if you're like a lot of folks all across the country and you've been waiting, waiting, and praying and praying that housing prices would finally come down, I think uh this is the video for you because as I say on Wall Street, they never ring the bell when it's time to buy. But I'm telling you right now, I'm going to ring I I need a bell. I need to find that bell to ring because I think now is the time you buy. This is the year 2026, and we've been watching houses go escalate pretty rapidly from 2020 to 2025, and they've been softening ever since that time. and all the factors that go into a mortgage payments, the affordability of housing is coming down. So, in other words, all the components, property taxes, property insurance, interest rates, all working now in your favor to make 2026 really the time to be buying. And I'm going to prove that in this video and hopefully inspire you to get off the fence and start looking for that home and start building wealth for your family and yourself. So, as I always say, let's kick off this rodeo. Hi folks, I'm Kevin Fagen. I'm the mortgage patriot on your side, nestled here in the Hill Country above San Antonio, Texas, serving all you proud Texans and all you great folks all around the country. So, as always, a great timely video now because again, I'm going to talk about why 2026 is going to prove to be the best time you're opportunity you're going to have to buy over the last certainly over the last 5 years and maybe going forward. So, uh, as we do that, hit the like, subscribe, and show me that you care about this content that I'm trying to bring to you. I've got a lot of greatformational videos on my YouTube channel. As you can see here, I have everything from understanding VA loans to renovation loans to FHA. When is the best time to use an FHA loan? Occasionally, I do real estate topics like this, like why now is the time to buy. So, let's get into all that content right now. I want to lean heavily on this graph here shown by the Federal Reserve of St. Louis, which provides residential median income prices. Uh they've been doing this for for quite a while now. And you can see in this chart here which starts in 1993 and runs all the way to current first quarter 2026. And you can see from once again from 1993 we had a healthy you know like almost a 14-year run of steady appreciation all the way up to about 2007. And you know what happened in 2007208 of course we had the great housing crisis the great crash and that happened for a lot of reasons but mainly it was for you know uh lacks uh lending standards. So, in other words, anybody, people that didn't even have incomes were allowed to try to buy a home. And of course, all that did was just inflate prices because there were so many biders trying to buy houses that had artificially inflated the prices. And finally, that bubble popped in 2007 and led to a decline, pretty rapid decline, um, from 2007 2009. But notice that that every time you have a a down period or a consolidation as I like to call them, you have the groundwork for a new run of appreciation. So what happened in 2000 starting about 2010? Well, in 2010, as you can see, it it started a new cycle of appreciation and that ran about seven years all the way up the graph till about 2017. In the fourth quarter of 2017, we didn't really have a crash, but we had a consolidation period where we we went another three almost four years of housing prices softening in some areas, coming down in some areas or flattening out in others. In other words, without any appreciation, but not without any necessarily declines. That is a classic period of consolidation. And anytime you have a period of consolidation, it's setting the groundwork once again for another upward movement in appreciation. And that's exactly what happened as you can see in 2020 which we're all familiar with the COVID period where where appreciation just went skyrocketed from 2020 to about 2023 we saw housing prices go up dramatically. Okay, thanks for the history lesson Kevin but how does this help me? Well, let me tell you exactly how it helps you. Now look very carefully at this graph once again. You can see from the end of 2022 to the start of 2026 what have we done? we are have entered another three-year hit uh three-year time span of consolidation. Now, some areas have seen downfalls like the the areas that were super heated like Austin, maybe Denver, prices have come down in some of these areas, but for the most part markets like San Antonio, which have been very have stabilized and have softened very slightly. And that's true most likely over most of the of the nation. So, we're seeing not necessarily prices going up and prices not coming down, but consolidation and it's like a giant spring. It's being compressed because buying power is starting to catch up. I'm going to show talk about that in a minute with all the affordability factors. But with this this consolidation period is coming. And so, right now, as we enter 20, we're in the first quarter of 2026. I'm telling you, whether it happens this year or pretty soon, you're going to start seeing appreciation in housing again. So, this is the opportunity. You may not get another one for another five or six, seven years to be buying a home. Now, I'm going to show you hopefully why. Okay, let's get more practical now. Let's talk about how the affordability has gotten better for you uh over the last, you know, 6 months and and going forward. Uh and we're going to use the example of a $300,000 house because that's typically kind of the average median price of a first-time home buyer. And so, uh, if you look at this chart here again provided by the Federal Reserve of St. Louis, you'll see this is the interest rates on FHA loans. And the chart starts in, I think, the first quarter of 2021 where we were at that historical low 3%. Ah, wouldn't that be great to go back to the good old days, right? Ain't going to happen, folks. And as we saw it spiked, it went immediately spiked up over the next year or so uh to about 7% in 202 late 2021 came down to two to six and then spiked again even higher over 7% in 2023. Now since that time we've been coming down coming down grinding our way slowly down into this phase where now we've just cracked 6%. So on an FHA loan, maybe 8 months ago, we'd be quoting 6 and a half%. And now in the first quarter of 2026, we're quoting below six, like 5.875. So what's the difference on a $300,000 house? That difference is about 115 to$120 bucks per month of just in lower, you know, principal and interest. Not bad. So, aside from interest rate levels, the other two big factors that affect housing affordability are property tax levels and property insurance levels. At least in the state of Texas, uh we've gotten some reprieve in terms of the property taxes for two reasons. One, because prices have softened, right? The county assessments of those valuations of the homes have come down and therefore no matter even if the rate doesn't change, the property tax rate doesn't change, the assessment is down because the property values are less. So, but in addition to that, we've all they've also in a lot of counties expanded the ex the exemption of a home of a of a primary homeowner's homestead exemption. So, in other words, on a $300,000 house, at least again, in the state of Texas, you'd be paying, you know, 6 months ago, 8 months ago, probably about $425 per month in property taxes. Uh now, you'd be paying about $375 in property taxes, saving about 50 bucks a month just off the property tax decrease or the exemption being increased. Not bad. again. And also property uh insurance rates, I wouldn't say they've come down, but in some places they've stabilized and they've they actually have softened because last year was kind of a relatively low catastrophic year in terms of of disasters across the country. And so I'm getting quotes now across again, this is across Texas where on a $300,000 house, let's say the average premium monthly would have been about $175. Now that's down to about $150. So across the big three, interest rates, property taxes, and property insurance, we're saving $15 plus 50 plus 25, that's $190 a month more affordable. In other words, your payment is about $190 less than what it would have been even 6 months ago. So that's pretty good. And that's that's called affordability catching up to, you know, to the to the real market. That's why it's a time to buying houses right now. Okay. So, I've shown you the historical data of how we're now into a consolidation period that I think is going to lead to another appreciation phase starting very soon. Uh, and I've also showed you now that affordability is down, meaning affordability is better to the tune of almost $200 per month on a $300,000 starter, you know, uh, median home for a, you know, first-time home buyers. So, let's look at now national average of of the actual u houses that are on market. And what I want to point out is this one big figure here and it's it's days on market. That's the that's the most often quoted statistic with houses that are for sale on the market. How long you been on the market? Well, that number has increased steadily now to about 64 days. Um, and it's the highest number that it's been over the last six years. In other words, houses are on the market now longer than they have ever been for the last six years. And that means the housing market has softened. And that gives you an opportunity to do some great things. Meaning, you can negotiate. And look at my video here where I talk about how to negotiate like a pro, how to negotiate for not just lower pricing, but more importantly for you first-time home buyers is significant seller concessions. Because seller concessions are the way to drive down the check that you're going to write at closing. On a $300,000 house nationally, you're probably going to write a check anywhere from from about 17 to $21,000 depending on what state you're in. Uh because they have different title costs and so forth. But with seller concessions in a soft market like this, you can get up to potentially 6% in an FHA loan of seller concessions. Don't always get that, of course, but you can you can bargain for it. And someone like myself who's got experience can help you achieve that. So, on a $300,000 house, 6% of that is $18,000. That means you could theoretically get your cash to close, the check you're going to write at closing can be less than, you know, $2 or $3,000. And I've had plenty of instances in my own experience just in the last eight months, uh, of getting a $300,000 house or close to that price, uh, where the buyer is only coming out of pocket for about 6,000 to, you know, or even less. So, it takes an experienced agent and it takes an experienced mortgage uh person like myself to be able to negotiate these things. But in a soft market like we're showing right now, because now is the time to buy, you're going to get those big seller concessions. Once we come out of this consolidation and we start to appreciate more rapidly, those concessions are going to go away because why? Because there's too many biders, too many buyers out there, you know, vying for the same property. But now that things have slowed down, that's why I'm arguing. Please, please, please, the bell is ringing by now. I'm Kevin Fe, the mortgage patron on your side. Make