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We hope you’re doing well! We had a bit of a pause in April due to unexpected health stuff (Steve), but we’re fully back in action! This month, we want to talk about how the war with Iran impacted the housing market in several ways.
Note: this article was featured in our June 2026 email newsletter.
Hello again, inflation… and higher interest rates
One day before the war started in late February, 30-year mortgages were around 5.9% – the lowest in four years. We saw buyers getting excited and activity was picking up. But oil prices spiked as they always do when conflict arises in the Middle East, and fear of inflation immediately spiked mortgage rates, which rose to over 6.5% within a month.
This caused mortgage applications to drop quickly. Some of our buyers who had committed to the process in January and February stuck it out, and we helped them find and purchase lovely homes. Nevertheless, this is the second year in a row with economic news disturbing the spring housing market (remember the tariffs hitting last April?).
The national story: spring disappointed
Both new listings and sales nationally have trailed 2025 levels — and 2025 was a funky year (not in a good way!). Agents commented that time on market was becoming a major seller concern, while affordability challenges were causing some buyers to get out of the market entirely. Some reported sellers postponing listings because of economic uncertainty.
The Sacramento region: better than expected
Despite facing the same economic situation as the rest of the country, the local region fared better than expected for most of the spring, with a rising number of new listings. But lately, the national slowdown may be catching up to us. Our friend and appraiser, Ryan Lundquist, said it well:
SELLERS HAVE BEEN SHRINKING BACK LATELY
This is big news. It looks like increased uncertainty this year is starting to affect seller behavior. Think Iran War and inflation. What I mean is sellers have started to not list homes as much in 2026. This was a problem last year where sellers really stepped back during the second half of 2025. Yet, sellers started coming back to the market, and that’s why we saw five months in a row of finally being back above 2024 levels of new listings. But then May 2026 sunk back below 2024 levels again (doh!!!). This isn’t a drastic change, but I think it’s been enough to make the housing market feel a little tighter since there isn’t as much supply out there. Frankly, this is a step in the wrong direction for affordability. If we want the housing market to heal, we need more listings.
– Sacramento Appraisal Blog, 6/3/2026
Bottom line: some slowness, but buyers and sellers haven’t disappeared
Interest rate increases and economic uncertainty have certainly affected us, but thousands of homes are still selling every month. Many buyers recognize that they can refinance in the future when rates are lower. Many sellers are still seeing homes sell fast if they are in solid condition. Buyers are more picky about condition than in recent years, so keep that in mind if you’re considering selling.
If you’d like some advice about how to prepare your home to sell or how to find the right home for your next move, reach out to us (just send an email or call/text at our numbers below). We’re here as your expert advisors for this market, come what may.
Garden Corner
If you still have the itch to plant something, you’re not too late! Summer veggies like corn and beans can still be planted. Heat-loving flowers, like zinnias, sunflowers, and marigolds are also still good. Get the seeds directly in the ground, put a light mulch on them (like a thin layer of straw) to preserve moisture, and give them a light watering every day or two until they sprout. Ask us if you have any questions!
Also, we’re back meeting people at the Fair Oaks Farmers Market on Tuesdays from 9 AM to 2 PM. Stop by and chat with us about real estate, the local market, gardening, or anything else on your mind.
That’s it for now. Let us know if we can help you with any real estate needs or questions (including gardening ideas, contractor references, or anything home related).
