January Readiness Creates February Leverage

Every housing market rewards different behaviors. Some years favor speed, while others favor patience. In Albuquerque, 2026 will reward preparation.

As we approach the new year, many buyers are asking, “Should I wait for rates to drop?” However, a more strategic question is, “How do I create leverage if rates don’t?” In 2026, leverage will come from being ready before opportunities arise.

Mortgage rates reached a 23-year high in 2023, cooled slightly in 2024 and 2025, and are expected to remain stable throughout 2026. By late 2025, the national average for a 30-year fixed mortgage hovered around 6.18%. Major housing authorities have aligned forecasts as we move into the new year.

Most predictions place rates in the low-to-mid 6% range by the end of 2026. This shift in strategy is significant; this is not a market to wait out. It is a market where having a plan is essential.

As rates stabilize, markets begin to normalize. Forecasts indicate that inventory in Albuquerque will rise nearly 9% year-over-year, home price growth will slow to about 2% to 3.5%, existing home sales will increase from long-term lows, and monthly payments will decline slightly for the first time since 2020. Buyer negotiating power will improve as competition eases, creating a balanced market.

Homes will still sell quickly, especially those that are well-priced. Sellers will become more responsive to solid offers from qualified buyers, making preparation a valuable asset.

Nearly 80% of homeowners with a mortgage have rates below 6%. This reality keeps many potential sellers from listing their homes. Consequently, inventory will recover slowly, and well-priced homes will still attract interest. Buyers who wait for a surge in listings or a significant drop in rates may find themselves stuck longer than anticipated.

At NEO Home Loans, we observe a recurring pattern. Buyers who succeed in February, March, and April are rarely those who start preparing then. The successful buyers clarify their finances early, strengthen their buying position before shopping, understand how to structure offers strategically, and are ready when the right home becomes available. Leverage is created before the listing hits the market.

Preparation goes beyond having a pre-approval letter. NEO assists buyers on three levels. First, we provide financial clarity by helping buyers understand their true buying power, how down payment choices affect rates and affordability, and modeling various scenarios to enable proactive decision-making. Second, we offer strength by getting buyers fully underwritten early, minimizing surprises during escrow, and helping them present competitive offers without overpaying. Lastly, we emphasize strategy over guesswork by guiding buyers through builder incentives, new construction opportunities, and negotiation strategies tailored to current inventory and demand.

One of the key advantages in today’s market is new construction. Builders are motivated sellers in 2026, often offering mortgage rate buydowns, closing cost credits, and below-market financing options. In many cases, new homes in Albuquerque now cost less per square foot than existing homes, filling the gap left by limited entry-level resale inventory. Prepared buyers will be the ones to benefit from these opportunities.

Even with modest home price growth, affordability is gradually improving. This is due to stable mortgage rates, expected income growth outpacing inflation, and a slight softening of real home prices. For the first time since 2022, typical mortgage payments are projected to fall below 30% of median income, a significant threshold for buyers.

While the changes may not seem dramatic day-to-day, they can enhance possibilities for those who are prepared.

2026 will present challenges for buyers. Affordability remains a concern, inventory is still below pre-pandemic levels, and rates are unlikely to return to 3%. However, buyers are no longer powerless. Negotiating power is improving, inventory is increasing, and sellers are adjusting their expectations.

The buyers who thrive will not be those waiting for ideal conditions but those who plan for real ones.

If purchasing a home is part of your plan for 2026, January is the perfect time to start preparing. Begin now to unlock greater inventory, improved affordability, and stronger negotiating power when it matters most.

At NEO Home Loans, we focus on helping you prepare for the market rather than chasing it. When opportunity arises, you will be ready.