MELIA's Monthly Market Watch- August 2026

MARKET WATCH
Rates, Prices, and the Shifting Balance of Power

A Plain-English Look at the National Trends Shaping Our Local Market — August 2026

Hi neighbors, friends, and clients —
It's been a busy month in real estate news — a Fed meeting on the horizon, fresh data on home prices, inventory, and
consumer confidence, plus two major industry shake-ups. Here's this months plain-English rundown of what's happening
nationally and what it actually means for you here at home.

1. Mortgage Rates Hold Near 6.8% as the Fed Weighs a September Hike

Minutes from the Federal Reserves July meeting, released this week, show broader support for raising rates than the
original 9-3 vote suggested. Three regional bank presidents pushed for an immediate quarter-point increase, and most
participants agreed a hike is likely if inflation doesn't keep easing toward the Feds 2% target.

The benchmark rate has held at 3.5%–3.75% since January, and the 30-year fixed mortgage rate is sitting near 6.8% —
essentially flat from last week, though a touch higher than this time last year. Purchase mortgage applications eased
slightly, while pending sales ticked up week-over-week even as they continue trailing last year's pace.
Two more inflation reports and a jobs report are due before the Feds September 16 vote — the next real window for a
policy shift before the fall meeting, which falls close to the midterm elections.

What it means for you: Rate direction is genuinely up in the air right now, and it'll hinge on the next few
weeks of economic data. Rather than trying to time the market, focus on being ready to move when the right
home or the right buyer shows up.

2. Home Price Growth Slows to Its Weakest Pace in a Decade

The Federal Housing Finance Agency's second-quarter report shows U.S. home prices grew just 2.1% over the past year
— the slowest annual pace in at least ten years, a sharp comedown from the 17.3% and 16.6% gains recorded in 2021 and
2022.

Growth varied widely by region. The East North Central states (including Ohio and Illinois) led the country at 4.5%
annual appreciation, while the Pacific division — including California and Washington — was essentially flat. Alaska
topped all states at 8.3%, while New Mexico, Colorado, California, and Washington posted the only annual declines.

What it means for you: National headlines about home prices rarely reflect what's happening on your
street. Kentucky isn't seeing the swings hitting the coasts — pricing precision and local knowledge matter
more than a national average.

3. Inventory Keeps Climbing, Handing Buyers More Leverage

New listings and overall inventory both grew again this week and remain above last year's levels — up 2.4% and 1.6%
year-over-year, respectively. Price reductions are running near 42% of listings, holding roughly flat compared to a year
ago, which suggests sellers are pricing realistically rather than chasing the market down.

Pending sales rose 1.5% from the prior week, even though they're still trailing 2025's pace by a similar margin. The
overall picture: a market that continues to rebalance, giving buyers more homes to choose from and more room to
negotiate on price, repairs, and concessions than they've had in several years.

What it means for you: If you're buying, this is a good stretch to negotiate rather than settle. If you're
selling, expect more competition for buyer attention — accurate pricing from day one still wins.

4. Renovation Costs Are Making "Move-In Ready" Harder to Deliver

A dwindling pool of skilled labor, tariff-driven material costs, rising insurance premiums, and higher permitting fees are
all pushing renovation costs sharply higher. The National Association of Home Builders reports that tariffs and trade
policy alone have added about 6.9% to typical remodeling material costs.

Angi's 2026 State of Home Spending Pulse found that 54% of homeowners who postponed a planned project cited cost as
the reason, and in the past 30 days, homeowners were nearly twice as likely to do basic maintenance (63%) as an actual
renovation (35%). In some markets, sellers are now investing well over $100,000 to get a home market-ready — with
thinner margins than the "$2 back for every $1 spent" homeowners could once expect.

What it means for you: If your home needs work before listing, start the repair conversation early and
budget generously — contractor timelines and material costs have both moved up. And if you're buying a
home that needs updating, factor today's higher renovation costs into your offer, not yesterday's.

5. Consumers Are Feeling Uneasy — But Not Panicked

The Conference Board's Consumer Confidence Index dipped again in August, falling to 89.4 from July's 90.2 — the
second straight monthly decline. A separate University of Michigan survey showed an even sharper drop in sentiment this
month, roughly 8% lower than before.

The dip isn't about today so much as tomorrow. Consumer's views of current conditions actually improved — more people
say jobs are "plentiful" than a month ago. But their outlook for the next six months turned more pessimistic, with fewer
people expecting business conditions, hiring, or their own income to improve. Rising prices, ongoing conflict overseas,
and uncertainty around interest rates were the most common concerns people wrote in about.

It's worth keeping in perspective: economists aren't calling this a warning sign of recession, and most consumers still see a
downturn as unlikely. But it helps explain why buyers may be moving a little more cautiously right now, even with more
homes to choose from.

What it means for you: People aren't losing confidence in the economy today — they're just less sure about
tomorrow. If you're selling, a little extra reassurance and clear communication throughout the process goes
a long way right now. If you're buying, remember that hesitation in the broader market often means less
competition for you.

6. Two Big Shake-Ups Reshaping the Industry

● Real + REMAX: The Real Brokerage completed its $880 million acquisition of REMAX, forming a combined
company — Real REMAX Group — with more than 180,000 agents worldwide, now trading on Nasdaq under
the ticker REAX. Both brands will continue operating separately for now.

● Zillow, Redfin & the FTC: Zillow and Redfin reached a settlement with the FTC and five state attorneys general
over their rental-listings partnership. Redfin is required to relaunch an independent rental listings business within
six months, while the two companies' existing rental syndication partnership continues.

What it means for you: Neither shift changes your day-to-day buying or selling experience, but they're
reshaping the competitive landscape behind the scenes — good context if it comes up in conversation.

The Bottom Line

This is a market in transition: rates are genuinely uncertain heading into September, price growth has cooled to its slowest
pace in years, and buyers have more room to negotiate than they've had in a while. None of that is cause for alarm — it's a reason to be prepared and precise. If you're weighing a move, I'm always happy to talk through what these trends mean for
your specific situation — no pressure, just a conversation.

Thanks for reading, and as always, feel free to pass this along to anyone who might find it useful.

Warmly,

Melia Hord
MELIA Realty • "All Things Home in One PLACE" • #justaskmelia