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2026 Home-Buying Trends: Are Buyers Choosing Suburbs or Cities?
Where do buyers want to live in 2026?
The answer isn’t as simple as city versus suburb.
Today’s buyers are balancing home prices, available inventory, commute needs, space, housing type and overall monthly costs. For some, that calculation points toward a suburban home with more square footage. For others, an existing home or condo closer to an urban employment center may make more sense.
And increasingly, buyers aren’t choosing a location because one lifestyle is universally “better.”
They’re looking for the combination that works for their individual budget and priorities.
Here’s what some of the latest national housing data tells us about 2026 home-buying trends—and what buyers should consider when deciding where to focus their search.
The 2026 Housing Market Is Giving Buyers Mixed Signals
First, some national context.
Existing-home sales decreased 2.4% from May to June 2026, although sales were 2.8% higher than one year earlier. NAR reported approximately 1.56 million homes in inventory, representing 4.6 months of supply. The national median existing-home sales price reached $440,600, up 1.8% year over year.
Affordability has also improved somewhat.
NAR’s Housing Affordability Index reached 102.3 in June 2026, compared with 95.5 one year earlier, with affordability improving year over year across all four regions.
But that doesn’t mean housing has suddenly become inexpensive.
Harvard’s Joint Center for Housing Studies describes national housing activity as subdued, with high housing costs and economic uncertainty continuing to sideline potential buyers. Existing-home sales have also remained near historically low levels.
In other words:
Some conditions are improving, but affordability remains a major consideration.
And that is influencing where buyers look.
Suburban Home-Buying Trends: More New Construction
One of the biggest differences between suburban and urban markets in 2026 is where new homes are actually being built.
According to Realtor.com’s Q1 2026 New Construction Insights Report, 79.8% of new-construction homes for sale nationally were located in suburban ZIP codes.
Compare that with just 10.9% in urban ZIP codes.
That’s a huge difference.
Land is generally more available for development outside dense urban areas, and many larger new-home communities are built on the outskirts of metropolitan areas.
For buyers specifically interested in a newly constructed home, that means the suburbs may simply provide substantially more options.
New Suburban Homes Are Also More Competitive on Price
Here’s another interesting finding.
The median listing price for a new-construction home in a suburban ZIP code during Q1 2026 was $427,900, compared with $399,900 for an existing suburban home.
That’s approximately a 7% new-construction premium.
Nationally, that makes suburban new construction considerably more price-competitive with existing housing than urban new construction.
That doesn’t mean a newly built suburban home is automatically affordable—or a better value.
But buyers who assumed new construction would always carry a massive premium may want to compare the numbers in their particular market before ruling it out.
What Buyers Should Consider About Suburban Living
More square footage or newer construction may sound appealing, but purchase price isn’t the only number that matters.
Before choosing a suburban property, consider your total cost and routine.
That might include:
- Property taxes
- Homeowners insurance
- HOA dues
- Transportation and commuting costs
- Home maintenance
- Utilities
- Lot maintenance
- Time spent commuting
A less expensive home farther from work isn’t necessarily less expensive once you consider the complete picture.
And because these factors vary dramatically from one community to another, national averages won’t tell you which choice makes sense for you.
Urban Home-Buying Trends: Existing Homes Tell a Different Story
If you’re looking for new construction in an urban ZIP code, your options are much more limited nationally.
Only 10.9% of new-construction listings in Realtor.com’s Q1 analysis were located in urban ZIP codes, compared with 29.7% of existing-home listings.
And new urban construction wasn’t cheap.
The median listing price for an urban new-construction home was approximately $738,662, compared with $414,000 for an existing urban home.
That’s a 78.4% premium.
There’s an important caveat, though.
Those are national figures across different properties and markets. They don’t mean a particular new condo will cost exactly 78% more than a comparable existing condo.
But they do demonstrate just how different the urban new-construction market is from its suburban counterpart.
For buyers interested in urban living, existing housing stock may provide substantially more options than new construction.
So, Are Buyers Moving Back to Cities?
I wouldn’t make that claim based on these numbers alone.
What we can say is that buyers evaluating urban locations in 2026 have a different set of choices than buyers focused on suburban new construction.
An urban buyer may be comparing existing condos, townhomes and houses, while a suburban buyer may encounter a much larger selection of newly constructed properties.
The right choice comes down to the individual buyer.
What About San Jose and Silicon Valley?
This is where national housing trends need to be put into perspective.
San Jose isn’t the national housing market.
Neither is Willow Glen, Almaden, Cambrian, Japantown or Downtown San Jose.
In fact, Realtor.com’s data shows how dramatically California can differ from national patterns. In the broader San Francisco-Oakland-Fremont metro, 68.9% of new-construction listings in Q1 2026 were classified as urban—almost the opposite of the national picture.
That’s why I’d never tell a San Jose buyer to choose a neighborhood based on a national headline about buyers “returning to cities” or “moving to the suburbs.”
Your search needs to be much more specific.
Questions to Ask Before Choosing Where to Buy
Instead of beginning with urban or suburban?, I encourage buyers to start with their actual priorities.
Consider:
What type of home fits my budget?
How much space do I realistically need?
How important is proximity to work or other destinations I visit regularly?
What will my total monthly housing costs look like?
Do I want an existing property or new construction?
How much maintenance am I comfortable taking on?
Which property features are essential, and which are simply nice to have?
Once you’ve answered those questions, your search area often becomes much clearer.
Don’t Forget the Resale Question
Even if you’re planning to stay for years, think about the property’s long-term marketability.
That doesn’t mean trying to predict exactly what your home will be worth ten years from now—I cannot confirm that, and nobody can reliably make that prediction.
Instead, evaluate the fundamentals.
Consider the property’s condition, layout, lot or unit characteristics, parking, HOA where applicable, nearby housing supply and recent comparable sales.
A trendy neighborhood label matters less than whether you’re purchasing the right property at a price and monthly cost that work for you.
The Biggest Home-Buying Trend of 2026: Buyers Are Comparing More Carefully
If there’s one theme connecting the national housing data, it’s that today’s buyers have plenty to evaluate.
Housing affordability remains challenging. New construction is heavily concentrated in suburban areas nationally. Urban new construction is comparatively scarce and expensive. And existing-home market conditions vary significantly from one metro—and even one neighborhood—to another.
That makes strategy and local information particularly important.
The best community isn’t automatically urban.
It isn’t automatically suburban.
It’s the one where the home, location, costs and lifestyle considerations align with your priorities.
If you’re considering buying in San Jose or Silicon Valley, I can help you compare neighborhoods, recent sales and current inventory so you can make your decision based on what’s actually happening locally—not just the national headlines.
Ready to start your San Jose home search? Let’s talk about what you’re looking for and build your strategy from there.
EXPLORE SAN JOSE NEIGHBORHOODS
Michelle Elliott | Coldwell Banker Realty | DRE #01777533
408-839-7915 | michelle@michelleelliottrealtor.com
