Zillow’s latest forecast shows two housing metrics moving in opposite directions at the same time: the company’s rent-growth forecast jumped 13% from last month even as its outlook for home sales keeps getting revised downward, according to Zillow Research’s August 2026 forecast.
Zillow now projects single-family rents to rise 2.1% in 2026, pushing the typical monthly rent to $2,300, while multifamily rents climb 1.8%. The forecast itself — the model’s projection of where rents are headed — accelerated 13% month-over-month, a sign Zillow’s economists see rental demand building faster than they expected even a few weeks earlier.
Home sales tell the opposite story. Zillow’s own August Market Report shows just 339,927 homes closed nationally last month — down 0.6% from a year earlier and down 10.7% from July. Zillow’s full-year sales projection of 3.78 million existing homes still shows a slight annual gain, but the company says that figure “masks a lopsided story,” with sales growth expected to turn negative in the fourth quarter, down 3.2%.
The National Association of Realtors’ own August report, released the same week, backs up the slowdown with a separate data set: existing-home sales fell to a 3.98 million seasonally adjusted annual rate, down 2.0% from July and 1.2% from a year earlier, even as the median price rose to $429,100. “Mortgage rates and home sales move in opposite directions, so it’s not surprising to see a mild dip in home buying activity due to high mortgage rates,” NAR chief economist Lawrence Yun said in the association’s release.
Zillow’s data shows the divide playing out unevenly by city. San Francisco rents jumped 10.8% year-over-year to a typical $3,409, and New York rents rose 4.2% to $3,615, while Chicago posted a home-sales gain of 4.9% even as Dallas sales fell 2.1% over the same period.
For households, the split has a simple practical read. Renewing a lease is getting more expensive faster than Zillow predicted a month ago, while buyers face a market with rising inventory — up 5.9% year-over-year, per NAR, to a 4.9-month supply — and more room to negotiate, even if mortgage rates above 6.5% are keeping many of them on the sidelines.
Zillow projects home values will rise just 0.3% for all of 2026, the smallest annual gain in years, while renters absorb the fastest-accelerating rent forecast the company has published in months. It’s the first time in years the two sides of the housing market have pulled this hard in opposite directions at once.
