Strengthening economic growth will not provide much of a lift to the housing market, which we expect to remain in its structural malaise as mortgage rates stay above 6% over the forecast period. We expect total home sales of 4.7m this year to mark the weakest result since 2011, and we anticipate only modest growth to 4.9m in 2027 and 5.0m in 2028, leaving sales around 1m below “usual” pre-Covid levels. After prices flatline this year, low resale supply should ensure positive, albeit tepid, house price gains of 2.5% next year and 4.0% in 2028. Rental demand should continue to benefit from the stagnant for-sale market, though rising new supply will limit rental growth to an average of 2.3% p.a. over 2026-28.
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