Zillow (NASDAQ: Z and ZG) indicated that the US property market showed encouraging signs of recovery in February 2026, marking a potential turning point after years of subdued activity. According to Zillow’s latest data, property values posted their first monthly increase in seven months, while existing real estate sales edged higher year-over-year.
According to insights from Zillow, these developments, combined with improved affordability from declining mortgage rates, suggest buyers and sellers are regaining confidence as the spring buying season approaches.
Nationwide, the typical home value reached $361,371 in February, rising 0.1 percent from January and 0.4 percent from a year earlier.
This modest uptick ends a prolonged stretch of stagnation and aligns with broader expectations for increased market momentum.
Mortgage payments on a median-priced home (assuming a 20 percent down payment) fell to $1,738 monthly—7.7 percent lower than February 2025—thanks to easing interest rates.
Zillow analysts note that a typical median-income household now enjoys roughly $30,000 more in purchasing power compared with last year, a shift that could draw hesitant buyers back into the market.
Sales activity also brightened.
Approximately 239,910 homes changed hands in February, representing a 1.8 percent increase from the prior year and a robust 13 percent jump from January.
Newly pending sales, an early indicator of buyer interest, climbed 3.5 percent year-over-year.
These gains come after unusually harsh winter weather likely suppressed January figures, reinforcing the view that seasonal factors, rather than fundamental weakness, had temporarily cooled demand.
Inventory levels continued their gradual climb, reaching 1.12 million homes for sale nationwide.
That total stands 5 percent above February 2025, offering buyers slightly more choices after years of tight supply.
New listings, however, dipped 3 percent year-over-year to 283,478, a figure analysts will monitor closely in coming months.
On the competition front, homes spent a median of 28 days on the market before going under contract—four days longer than a year ago but still reflecting a relatively brisk pace.
Price cuts appeared on 20.3 percent of listings, down from the previous year, while 20.4 percent of homes sold above asking price in the latest available data.
Rental trends remained stable but showed signs of cooling.
The typical monthly rent nationwide stood at $1,895, up 1.9 percent annually yet only 0.4 percent from January.
Concessions were offered on nearly 40 percent of listings, indicating landlords are still working to attract tenants amid softening demand.
Regional performance varied.
Major metros such as New York, Chicago, and Seattle posted solid year-over-year home-value gains, while Sun Belt markets like Dallas, Houston, and Austin experienced modest declines.
Inventory grew notably in the South and Midwest, providing relief to buyers in those areas.
Zillow Chief Economist Mischa Fisher highlighted the data’s significance: buyers now have more realistic options, and lower borrowing costs may finally unlock homeowners who have felt “locked in” by high rates.
With mortgage rates potentially dipping below 6 percent, the combination of better affordability and rising inventory could spark a meaningful uptick in transactions.
As spring arrives, the US property market now seemingly appears poised for its strongest showing in years.
The Zillow update concluded that while certain challenges like limited new construction persist, February’s figures offer the clearest evidence yet that the long-awaited rebound in the property market may be underway. Home shoppers and sellers should now prepare for a more active—and competitive—real estate landscape.