Housing Market Update: Nebraska & Iowa — Early 2026
Liz Gibbs

The Midwest housing market is off to an interesting start in 2026. Nationwide, buyers and sellers are adjusting to shifting mortgage rates, tight inventory, and ongoing affordability challenges. Nebraska and Iowa follow these broader trends, but each state brings its own unique market dynamics.

Mortgage Rates & National Context

Across the U.S., mortgage rates have eased from their 2024–2025 highs and are now sitting in the mid‑6% range for a 30‑year fixed loan. While still higher than the historic lows of the pandemic, today's rates offer more relief than buyers have seen in recent years. As a result, existing home sales have ticked up, creating a more confident start to 2026.

Nebraska: Strong Demand, Tight Supply

Prices Still Rising

Nebraska continues to see steady home price growth, with statewide averages rising around 3% year‑over‑year. Many markets are now in the mid‑to‑upper $200,000s or low $300,000s. Omaha in particular remains one of the state's hottest markets, with some segments seeing over 7% annual appreciation.

Inventory Remains Low

Low inventory is one of the defining themes in Nebraska. In many areas, supply sits well below the six months considered “balanced.” Omaha currently averages between 1.8 and 2.3 months of available homes, creating a competitive environment for buyers.

  • Homes in desirable areas sell quickly
  • Bidding wars still occur on well‑priced listings
  • Buyers need to act fast when good opportunities appear

What’s Driving This?

A blend of local and national factors keeps demand strong:

  • A healthy job market and stable economy
  • New construction that still isn’t enough to close the supply gap
  • Varied trends between rural, suburban, and metro areas

Iowa: Affordable but Competitive

Price Growth & Market Activity

Iowa’s housing market continues its pattern of gradual price appreciation, typically in the low‑to‑mid single digits. Markets like Des Moines and Council Bluffs remain active, with solid demand across most price ranges. Des Moines has seen some softening at higher price tiers since 2022, but overall competition remains steady.

Inventory & Affordability

While Iowa’s inventory is slightly healthier than Nebraska’s, desirable neighborhoods still experience quick sales. The state’s relative affordability continues to benefit first‑time buyers and investors alike.

However, some concerns remain — particularly in urban areas where affordable housing stock is shrinking as subsidized units convert to market‑rate over time.

What This Means for You

For Buyers

  • Good news: Mortgage rates are lower than last year.
  • Challenge: Inventory remains tight in popular areas.
  • Tip: Be prepared to move quickly when the right home hits the market.

For Sellers

  • Good news: Demand is strong in many neighborhoods.
  • Challenge: Some higher‑priced segments are softening.
  • Tip: Price competitively — overpricing can lead to unnecessary days on market.

Looking Ahead

Most experts anticipate modest price growth and slightly higher sales activity throughout 2026, driven by improved mortgage affordability. However, persistent supply limitations and ongoing affordability challenges may continue to shape the market unless new construction increases significantly.

Bottom Line

  • Nebraska: Still largely a seller’s market with tight supply and rising prices.
  • Iowa: More balanced but competitive, with affordability remaining a strong advantage.

If you're thinking about buying or selling in Nebraska or Iowa, it’s a dynamic moment — rates have improved, but inventory still favors sellers in many areas. Staying prepared and informed can make all the difference.