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Clear out junk files and repair common Windows errorsFree Scan →Scan for outdated or missing drivers - takes under a minuteDriver Scan →Repair Windows errors before they cause bigger problemsFix Now →In Redfin’s best-case scenario, the U.S. housing market would return to its August 2018 mortgage-payment-to-income benchmark by February 2029—just over two years from the October 2026 analysis. That outcome assumes mortgage rates fall to 6% and home-price growth stops. Redfin describes its scenarios as hypothetical, not predictions, and a return to a historical national ratio would not mean homes are affordable for every buyer or city.
What does “normal” mean in this estimate?
Redfin defines “normal” using the monthly mortgage-payment-to-income ratio: the estimated monthly cost of owning a median-priced home divided by median household income. Its national reference point is August 2018, when that ratio was 30%. This is a payment-to-income measure, not a mortgage-rate-to-income ratio.
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The benchmark is a historical comparison, not a universal affordability threshold. A national median can conceal large differences in home prices, incomes, taxes, insurance, and household finances.
How long could each scenario take?
Redfin modeled different combinations of mortgage rates and home-price growth. The time estimates below are outputs of those assumptions, not promised dates or forecasts.
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| Scenario | Mortgage-rate assumption | Annual home-price growth | Estimated return to August 2018 baseline |
|---|---|---|---|
| Best case | Falls to 6% | Flattens | February 2029 |
| Lower rates, continued appreciation | Falls to 6% | About 2.1% | About five years |
| Rates near current levels, flat prices | Remains around 7.5% | Flattens | About six years |
| Rates stay high, prices keep rising | Remains between 7% and 8% | About 2.1% | 10 years or more |
These are conditional illustrations from Redfin’s October 2026 analysis. In the best case, falling rates ease monthly borrowing costs while flat prices prevent the home-price side of the equation from moving further out of reach. If either assumption fails, the modeled return takes longer.
Why the best-case timeline is uncertain
Mortgage rates were not at the best-case assumption when the scenarios were published. Freddie Mac’s 30-year fixed-rate average was 7.4% as of October 8, 2026, according to its weekly survey. That was reported as the highest level in nearly three years and 1.1 percentage points above the year-earlier weekly average. Rates can change, but this snapshot does not establish that they will reach 6% or when they might do so. Freddie Mac’s Primary Mortgage Market Survey
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Market activity also showed strain in the October 8 report. Mortgage applications fell 4.2% for the week ending October 2, 2026, compared with the previous week; purchase applications were down 15% year over year, and the refinance index was down 56% year over year. These figures, attributed to the Mortgage Bankers Association, describe activity at that time rather than a long-term forecast.
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High borrowing costs affect buyers unevenly. First-time buyers without equity from a prior home purchase are more exposed to elevated rates, while owners with home-value gains may have more purchasing power when moving. A return to the national benchmark would not erase that difference.
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Why your city may reach the benchmark sooner—or later
Redfin’s national estimate does not apply uniformly across the country. In its modeled metro results, San Jose and Austin were among the places with earlier returns under some rate assumptions, while New York City, Chicago, and other Northeast and Midwest metros could take at least a decade in modeled cases. Redfin links the variation to local price momentum and projected income growth. About half of the metros it analyzed could take a decade or longer in modeled cases.
At the metro level, “normal” means returning to that metro’s own 2018 price-to-income relationship. It does not establish that the typical household can comfortably afford a home there. A city can reach its historical ratio and still be expensive for a buyer whose income, savings, or borrowing terms differ from the model’s assumptions.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What Redfin included in its calculations
Redfin modeled the monthly cost of a 30-year mortgage, including mortgage principal and interest, property taxes, and insurance, then divided that amount by median household income. The analysis assumed a 20% down payment and annual insurance equal to 0.5% of the home’s value. It used seasonally adjusted median home prices and compounded household-income growth based on 2015–2019 Census data. The metro analysis covered 46 of the 50 largest U.S. metro areas for which Redfin said sufficient data were available.
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Repair common Windows errors and clear accumulated junk for a smoother, more stable PC - no reinstall needed.Free scan · no reinstallThose assumptions make the scenarios useful for comparing broad paths, but they do not reproduce every buyer’s finances. Actual down payments, credit profiles, taxes, insurance costs, and income changes vary. The model’s baseline and timeline should therefore be read as a market-level yardstick, not an estimate of an individual household’s monthly budget.
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How to use the estimate if you are buying or selling
Do not make a housing decision solely to wait for a national ratio to return to its 2018 level. The key question for a household is whether a purchase or sale works under its own finances and timing, using a payment estimate that reflects its likely rate, down payment, taxes, insurance, and other costs. Redfin Senior Economist Asad Khan said the best time for buyers and sellers to move is when it makes sense for their finances and their lives.
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