What’s Actually Happening with Arizona Real Estate in 2026?

If 2025 felt like a year of “almost” for Arizona real estate, almost more inventory, almost better rates, almost back to normal, 2026 is shaping up to be the year where the market finally behaves more like a market again.

Not a crash. Not another pandemic-style surge. More like a reset into a steadier, more negotiable environment where pricing is calmer, buyers have more options, and strategy matters again.

Below is what the data is saying right now, plus a practical outlook for Quarter 1, and a dedicated section for Gilbert.

Where Arizona is starting 2026

The most useful thing we can do is ground this in current numbers, then build expectations from there.

ARMLS (Arizona Regional Multiple Listing Service) published December 2025 marketwide data on January 7, 2026. Here are a few headline signals:

• Median sales price: $450,000 (flat month over month, essentially unchanged year over year)
• Supply: 3.48 months (still below what most economists call a “balanced” 5 to 6 months, but no longer ultra-tight)
• Median days on market: 63 (a market that is moving, but not flying)

At the same time, mortgage rates have improved from a year ago. Freddie Mac’s weekly survey shows the average 30-year fixed rate at 6.16% as of January 8, 2026 (versus 6.93% a year earlier). 

That combination, steadier prices, slightly better rates, and a market that is no longer “one weekend and it’s gone,” is why 2026 is likely to feel more workable for both buyers and sellers.

The 5 forces that will shape AZ real estate in 2026

1) Mortgage rates will set the ceiling for demand

In Arizona, affordability is always rate-sensitive because prices are still high compared to pre-2020 norms. Even a small rate move can change buyer purchasing power and monthly payment dramatically.

Right now, major forecasters and commentary are leaning toward rates that hover in the low 6% range through 2026, rather than a rapid drop back into the 4% range. 

What that means in real life:

• When rates dip, buyer activity spikes quickly.
• When rates bump up, the market slows, especially above the median price point.

2) Inventory is improving, but the lock-in effect is still real

Many homeowners are sitting on mortgage rates far below today’s levels, and that “golden handcuffs” effect still limits the number of move-up sellers.

So even if we see more listings, supply may grow slowly, not explosively. ARMLS shows supply around 3.48 months, which is tighter than a truly balanced market.

3) Pricing looks more stable than sensational

Arizona’s median sales price ended 2025 steady at $450,000, with minimal year-over-year movement in that metric.

That’s a strong sign that the market has already done a lot of its “cooling” and is now in a more normal cycle:

• Well-priced homes still sell.
• Overpriced homes sit and require reductions or concessions.
• Condition, layout, and location matter more again.

4) Negotiation is back (and it’s not just about price)

A calmer market shifts leverage back toward buyers in specific situations: homes with deferred maintenance, heavy competition, or sellers with timing pressure.

Expect negotiations to center on:

• Seller concessions toward closing costs or rate buydowns
• Repair credits, especially after inspections
• Appraisal strategy and pricing realism

5) New construction will keep pressure on resale in certain corridors

Builders are still using incentives to keep absorption moving. In areas with heavy new-build supply, resale sellers often have to compete with:

• Rate buydowns
• Closing cost packages
• Design center incentives

That doesn’t mean resale loses. It means resale needs sharper positioning: pricing, presentation, and terms.

2026 forecast for Arizona: realistic expectations

Based on current pricing stability, improving affordability relative to last year’s rates, and a still-not-overbuilt resale inventory, here’s the most reasonable expectation for 2026:

• Price movement: modest, likely flat to low single-digit appreciation overall, with neighborhood-level differences doing the heavy lifting.
• Sales activity: slightly higher than the last two years, but still below the 2020–2021 boom norms, because rates remain the gatekeeper. 
• Market behavior: a more “balanced-feeling” market, with fewer bidding wars, more days on market, and more negotiated terms.

Predictions for Quarter 1 of 2026 (January to March)

Q1 in Arizona is almost always a transition season: winter buyers and snowbirds are active, while many local sellers wait for spring to list. Here’s what I’d predict for Q1 specifically.

Q1 prediction 1: Listings rise, but not enough to flood the market

You typically see new inventory build after the holidays, especially February into March. But because many homeowners remain rate-locked, we’re more likely to see a controlled increase, not a surge.

Q1 prediction 2: The best homes will still move fast

Even with a higher median days on market overall (63), the best listings are still absorbing quickly.
In Q1, homes that check these boxes tend to sell first:

• priced correctly from day one
• clean, updated, staged, strong photos
• in high-demand school boundaries and commutable locations

Q1 prediction 3: Concessions stay common in the “messy middle”

If a home is “fine but not fabulous,” meaning dated, overpriced, awkward layout, or competing with new builds, concessions will remain a major lever. Think rate buydowns, closing costs, and repair credits.

Q1 prediction 4: Buyers who are prepared will have negotiating power

Rates are still above the ultra-low era, so serious buyers tend to be more payment-focused. If you come in with strong financing, clear terms, and smart inspection strategy, Q1 can offer real leverage.

Gilbert real estate: what to expect in 2026

Gilbert has its own rhythm. It’s one of the most consistently in-demand East Valley markets because of schools, community planning, parks, and the lifestyle factor. That demand tends to cushion pricing during slower cycles, but it also makes “pricing it right” even more important, because buyers have options at this price point.

What the latest numbers show for Gilbert

Redfin’s most recent city snapshot (November 2025) puts Gilbert’s median sale price around $575,000, with average days on market around 53 days.

Takeaway:

• Gilbert is still moving.
• Buyers are not rushing like 2021, but they are buying when the home and the numbers make sense.

Gilbert-specific 2026 outlook

Here’s what I expect for Gilbert in 2026:

1. Move-in-ready wins the premium
   Updated kitchens, clean modern flooring, and turnkey backyards continue to command stronger pricing and faster absorption than dated inventory.
2. Price bands will behave differently
   The mid-range family home segment tends to stay active because it’s the deepest buyer pool. As you move up into luxury price points, you’ll often see longer days on market and heavier negotiation.
3. New builds and incentives matter nearby
   Gilbert and the surrounding growth corridors mean buyers often compare resale to builder offerings. If a builder is buying down rates, resale sellers need a strategy that addresses monthly payment and perceived value.
4. Q1 is a sweet spot for serious buyers
   For Gilbert buyers who want negotiating room, Q1 can be a smart window. There is often less frenzy than late spring, and sellers who list early tend to be more motivated and realistic.

What this means if you’re buying or selling in 2026

If you’re buying

Your edge in 2026 is preparation. With rates still meaningful, the best move is to shop the payment, not just the price:

• get fully underwritten when possible
• compare rate buydown options
• focus on neighborhoods where inventory is building and sellers are more flexible

If you’re selling

Your edge is positioning. In a negotiable market, you win on:

• pricing strategy that matches current demand, not last year’s headlines
• presentation that justifies the number
• terms that reduce friction for buyers, especially around concessions and repairs

The Bottomline: 2026 is the year strategy matters again

Arizona is entering 2026 with stable pricing, improving affordability versus last year, and a market tempo that rewards smart decisions over emotional ones.

If you want, I can tailor a Q1 2026 mini-forecast for your exact farm area (Gilbert, Chandler, Mesa, Scottsdale, Queen Creek) by price range and property type, so your blog can include a “what this means for you” section that feels hyper-local.

If you’re thinking about making a move in 2026, message me the city and your ideal price range, and I’ll send you a quick, data-backed snapshot of what’s happening right now and what to watch in Q1.