3 things homebuyers should do in 2026 (and 3 things to avoid), according to experts

Mortgage rates have slowly declined throughout 2025, with the average 30-year fixed mortgage rate falling from a peak of 7.04% in January to an average of just under 6% in late December. And, there's a chance that mortgage rates could fall further in 2026, easing things even further for buyers. Certain conditions would need to be met, though, namely, additional Federal Reserve rate cuts and cooling inflation rates.

Lower mortgage rates could offer some extra relief to prospective homebuyers, many of whom have been waiting for further reduced borrowing costs to buy a home. Fortunately, there are several ways to make it more affordable to purchase a home, but there are also a few things homebuyers should avoid during the process.

Find out how low your mortgage rate could be today.

3 things homebuyers should do in 2026, experts say

There are a few things homebuyers may want to do in the new year as they shop around for homes, experts say, and that includes the following:

Shop around for the lowest rate and best terms

With home affordability still a major challenge for homebuyers, it could pay off to shop around and find a lower mortgage rate in 2026 in order to reduce your monthly payment. 

"Interest rates can vary from lender to lender. Comparing costs as well as interest rates is vital to ensure you are getting the most competitive rates," says Jeremy Schachter, branch manager at Fairway Home Mortgage.

Remember, one discount point equals 1% of the loan amount, or $1,000 for every $100,000 borrowed. So even a rate difference of 0.25% to 0.5% could save you thousands of dollars over the life of the loan.

Learn more about the mortgage rates you could qualify for now.

Negotiate seller concessions 

Pending home sales were down 5.8% from a year earlier in mid-December 2025, according to the latest Redfin data. Many prospective buyers are holding off on buying amid high housing prices and mortgage rates still above 6%.

Buyers who stay on the sidelines waiting for lower rates could end up "regretting not taking advantage of their current negotiating power while they have it," Craig Garcia, president at Capital Partners Mortgage, says.  

After all, if rates fall further, more buyers are likely to reenter the market, and that negotiating leverage may disappear. 

One of the most common ways buyers are using that leverage right now is by negotiating seller concessions. 

"We see half of transactions with some sort of seller concession for closing costs, and the shrewd buyers are negotiating to use some or all of those concessions to buy their interest rate down temporarily or permanently while the negotiating power is there now," says Garcia.

Consider homes that need minor updates

Housing inventory is improving, but it remains low relative to demand, which is keeping home prices out of reach for many buyers. If you're looking for a more affordable home, properties that need some updating can be a way to buy a home for less.

"There's real opportunity in homes that need some updating," says Jesse Sheldon, broker and director of operations of the Gordy Marks Real Estate Team at RE/MAX Northwest. "They tend to sit longer, and that gives buyers a chance to negotiate on price. If you can buy with a minimum down loan, put in the remodel work, and refinance in six months to a year, you're potentially walking into equity."

Sheldon adds that you may be able to refinance within six months to a year and potentially eliminate mortgage insurance after a reappraisal. 

"It's a smart way to make the numbers work when there is a premium on already remodeled homes," Sheldon says.

3 things homebuyers shouldn't do in 2026, experts say

And, there are also a few missteps potential homebuyers should avoid in the new year, including the following:

Assume recent interest rate drops will continue indefinitely

The idea of holding off on a home purchase in hopes of lower mortgage rates is tempting, but any rate drop that occurs in 2026 may be modest, says Dan Wetzel, senior vice president of mortgage lending at APG Federal Credit Union. 

"Most forecasts do not project a dramatic drop below the mid-6% range for the new year. If rates hold steady or even slightly increase, waiting could mean higher borrowing costs," Wetzel says.

Schachter notes another cost-related risk buyers should consider. 

"If you are holding off for a certain rate while home values go up, it may get you a higher payment, even with a lower rate. That $500,000 home early in 2026 may be $550,000 by the end of 2026. Even if rates come down by the end of 2026, your purchase price can be higher," Schachter says.

Expect home prices to fall

Given the market's current high prices, it's natural to hold out hope for lower prices in the new year. However, many forecasts project modest price increases of between 1% to 3% in 2026, though decreases are possible in some markets.

"Another important assumption that may be incorrect is thinking that home prices are going to drop," says Schachter. "With interest rates slowly coming down, competition will increase. And with increased competition comes higher demand. As a homebuyer, offering low-ball offers because you think the home is overpriced may leave you disappointed."

Overlook the total cost of homeownership 

It's easy to focus too heavily on home prices and mortgage rates when you're buying a home. But don't forget about other factors that could impact your monthly housing costs, says Wetzel. 

"Insurance premiums, property taxes and maintenance costs should also be considered when buying a home. Underestimating these costs can lead to overstretched budgets and unexpectedly high monthly housing payments," Wetzel says.

The bottom line

Before you begin seriously shopping for homes, it's important to get preapproved for a mortgage now. With a preapproval letter from your lender, you'll be ready to act fast if the market heats up in 2026. The preapproval shows sellers you can close the deal, which could help if you're bidding against other buyers who aren't preapproved. As you prepare to buy a home, consider the dos and don'ts above to take advantage of the conditions you're likely to face in 2026.