As mortgage rates gradually cool, a new wave of buyers may finally find room to breathe. With borrowing costs expected to move closer to 6% in the year ahead, several U.S. metro areas are positioning themselves for a noticeable surge in homebuying activity.
Markets with improving affordability, growing job bases, and strong millennial demand are now standing out. According to new research, the shift could unlock thousands of newly qualified buyers who were previously priced out.
Why Lower Rates Matter Right Now
Even a small dip in mortgage rates can have an outsized effect on purchasing power. A move from 7% to 6% may not sound dramatic, but for many households, it can be the difference between watching from the sidelines and entering the market.
The National Association of Realtors recently analyzed 10 key indicators, including buying power sensitivity, income alignment, migration trends, job growth, and inventory recovery, to identify where activity is likely to pick up fastest.
The goal was clear. Find metro areas where buyers, sellers, and real estate professionals all have meaningful opportunities ahead.
To qualify, each market needed a population above 250,000, stronger performance than the national average on at least five indicators, and visible signs of improving affordability and inventory.
Charleston, South Carolina
Charleston is seeing rising inventory in the $200,000 to $350,000 price range, a key threshold for first-time buyers. With mortgage rates at 6%, more than 20,000 additional households could qualify for a median-priced home.
Millennials make up 36% of local households, supported by strong job and income growth.
“Charleston has a large pool of renters who are just at the edge of affordability,” the report noted. “A shift from 7% to 6% significantly expands the number of local households who qualify for the median home.”
Charlotte, North Carolina
Charlotte stands out for its population growth and economic momentum. More than 52,000 additional households would qualify for a median-priced home at a 6% mortgage rate.
“Charlotte’s winning formula in 2026 is simple: young buyers, strong jobs, and more listings where people need them,” the report noted.
Columbus, Ohio
Columbus continues to exceed expectations across multiple indicators. At a 6% mortgage rate, over 41,000 additional households would qualify.
Millennials represent 37.5% of the population, incomes are rising, and job growth remains solid.
“Columbus continues to outperform expectations as one of the Midwest’s most resilient and stable housing markets. Income growth remains stronger than the U.S. average, and investments — including logistics expansions — are bringing high-quality jobs that support long-term housing demand,” NAR noted.
Indianapolis, Indiana
Indianapolis is emerging as one of the most balanced markets heading into 2026. More than 42,700 additional households would qualify with lower rates.
The city benefits from strong millennial demand, steady job gains, and home prices that better align with local incomes.
Jacksonville, Florida
Jacksonville is improving on two critical fronts at the same time.
“Jacksonville is one of the Florida markets where both affordability and inventory are improving at the same time,” NAR noted.
With rates at 6%, more than 39,700 additional households could afford a median-priced home. Migration and income growth continue to strengthen demand.
Minneapolis–St. Paul, Minnesota
The Twin Cities show one of the strongest responses to falling mortgage rates. More than 81,000 households would newly qualify at a 6% rate.
Inventory is returning in the $250,000 to $450,000 range, while job growth and millennial concentration remain high.
“Minneapolis is one of the nation’s most responsive markets to lower rates — and 2026 will show it,” NAR noted.
Raleigh, North Carolina
Nearly 27,000 additional households would qualify in Raleigh with lower mortgage rates.
The market benefits from fast income growth, strong job creation, and better alignment between home prices and earnings.
“Raleigh’s combination of fast-growing incomes and better-aligned inventory makes it one of the clearest opportunity markets of 2026,” NAR noted.
Richmond, Virginia
Richmond is quietly building momentum. With rates at 6%, more than 25,500 additional households would qualify for a median-priced home.
“Richmond’s strength lies in its stability — and in 2026, that stability becomes opportunity,” the report noted.
The metro shows fewer price cuts than the national average, solid job gains, and a strong millennial presence.
Salt Lake City, Utah
About 25,000 additional households could afford a median-priced home with lower rates.
Salt Lake City continues to post strong income growth and job gains, while listings increasingly align with what local buyers earn.
“Salt Lake City’s youthful demographics and improving inventory make it one of the biggest beneficiaries of lower rates in 2026,” NAR noted. “Listings aligned with incomes surged 20.7% year-over-year, making it one of the biggest affordability rebound markets.”
Spokane, Washington
Spokane remains one of the few Western metros moving in the right direction on both affordability and inventory.
“Spokane is one of the few Western metros where both affordability and inventory are trending in the right direction,” the report noted.
At a 6% mortgage rate, more than 9,500 additional households would qualify. Income growth, millennial demand, and fewer price cuts add to its appeal.
What the Latest Mortgage Data Shows
Mortgage rates edged slightly higher last week as markets reacted to the Federal Reserve cutting its benchmark interest rate for the third consecutive time.
The average 30-year fixed mortgage rate rose to 6.22% for the week ending Dec. 11, up from 6.19% the prior week, according to Freddie Mac. One year earlier, rates averaged 6.60%.
For buyers watching closely, even modest shifts could shape the housing landscape in the year ahead.
