US Housing Market Shows Divergent Trends as San Francisco Surges, Northeast Cools
Global residential markets exhibit varied localized performance, while commercial real estate stabilizes amid selective investment and geopolitical uncertainties.
The story
The US residential market is currently a study in regional contrasts. A recent report from Cotality on July 7th highlighted that national home price appreciation picked up to 0.8% year-over-year in May 2026, from 0.6% in April.
This momentum, up 1.6% over three months, is concentrated in affordable Midwestern areas and "elite equity havens" like San Francisco, where a staggering 7.6% of its 8.9% annual growth occurred in the last 90 days. Conversely, regions like New York and Nassau County/Long Island have seen three-month price declines of 0.6% and 0.4% respectively, with Rochester, NY experiencing a sharp 2.0% drop.
This segmentation reflects an affordability and wealth gap, according to Cotality's Chief Economist Dr. Selma Hepp.
Meanwhile, commercial real estate markets are stabilizing, though elevated interest rates and geopolitical uncertainty are fostering a more selective investment environment, as noted by BBG, Inc. in its July 7th outlook. Hong Kong's Central Grade A office market, however, bucked this trend, recording its strongest half-year rental growth in 15 years, with rents forecast to rise 10-15% in 2026.
G20 + UAE this cycle
| Country | Price Yoy Pct | Prime Yield Pct | Mortgage Rate Pct | Direction |
|---|---|---|---|---|
| USA | 0.8 | N/A | 6.43 | Mixed/Stabilizing |
| Australia | -0.4 | N/A | N/A | Cooling/Falling |
| Brazil | 68.5 | N/A | N/A | Rising (luxury segment) |
| Canada | N/A | N/A | N/A | N/A |
| China | -7.68 | N/A | N/A | Falling/Slump |
| France | N/A | N/A | 3.43 | Stabilizing/Cautious recovery |
| Germany | 2.3 | 3.8 | N/A | Moderate rise (residential investment up) |
| India | Rising | N/A | N/A | Rising/Strong demand |
| Indonesia | N/A | 10-18 (short-term rental villas) | N/A | Stable/Optimistic (government initiatives) |
| Italy | 5.2 | 4.0 | N/A | Rising (residential), Selective (investment) |
| Japan | N/A | N/A | N/A | N/A |
| Mexico | 7.5 | N/A | Unchanged | Slower growth/Affordability pressures |
| Russia | 6.0 | 7.32 | 10.8 | Mixed |
| Saudi Arabia | -1.6 | 6.84 | N/A | Cooling/Buyer repricing window |
| South Africa | 7.1 | N/A | 10.25 | Recovering/Stronger phase |
| South Korea | N/A | N/A | N/A | Stabilizing/Moderate growth |
| Turkey | 26.6 | 7.32 | N/A | Rising (nominal lira), dependent on domestic demand/inflation |
| UK | 0.6 | N/A | 5.53 | Modest recovery/Cautious |
| UAE | N/A | 6.58 | N/A | Steady momentum/Mature growth |
| Argentina | N/A | N/A | N/A | N/A |
UAE corner
Dubai's real estate market has seen a full recovery in transaction volumes from the Q1 2026 slowdown, returning to Q4 2025 levels. The villa market is reaching new highs in prime communities, with Jumeirah Village Circle (JVC) leading transaction counts.
Off-plan launches from major developers in June–July experienced strong take-up, indicating restored buyer confidence. Average gross residential rental yields remain attractive at 6.58% as of July 2026, with apartments yielding approximately 6.9%.
Dubai's luxury residential market set a new record in H1 2026, with 296 ultra-prime home sales over $10 million, totaling $5.1 billion. The most expensive residential transaction was a $114.9 million (AED422 million) six-bedroom apartment in Aman Residences.
India corner
Institutional investments in Indian real estate surged to $2.7 billion in Q2 2026, a 90% increase over the previous quarter and a 49% rise year-on-year, according to Vestian. Domestic institutional investors now represent a record 64% share of India's real estate investment in H1 2026, surpassing foreign inflows.
Chennai and Bengaluru together attracted about $1.2 billion in investments during January-June 2026, accounting for around 27% of total inflows, primarily in the office segment. Gurugram's circle rates have been revised upwards by 15–75%, with areas like Dwarka Expressway seeing significant gains. Luxury and ultra-luxury housing now constitute 42% of new project launches nationally, the highest share on record.
Residency-by-investment
Portugal Golden Visa
Country: Portugal
Threshold: €500,000 (investment funds)
What Changed: Nationality Law reformed in May 2026, extending citizenship timeline from 5 to 10 years (7 for EU/CPLP nationals) and changing citizenship clock start date to first residence card issuance. New language and civic tests introduced. Residency rights and investment routes remain unchanged.
Greece Golden Visa
Country: Greece
Threshold: From €250,000 (real estate, start-up investment)
What Changed: A new €250,000 Start-Up Investment option was introduced in early 2026. The program operates under a tiered threshold system, with €250,000 options available in certain areas and higher thresholds (€400,000 or €800,000) in high-demand zones.
Citizenship by Merit
Country: Malta
Threshold: N/A (merit-based, not investment-based)
What Changed: The structured Citizenship by Investment program was terminated for new applicants following a 2025 ECJ ruling and subsequent legislative changes. Malta now offers a merit-based naturalisation model for exceptional contributions rather than direct investment.
Spotlight country
The UK housing market is showing signs of a modest recovery, with house prices rising for the first time since the onset of the Iran war. The Lloyds House Price Index reported a 0.2% month-on-month increase in June 2026, bringing the annual growth rate to 0.6%.
This tentative turnaround is attributed to easing mortgage rates, which have encouraged buyers back into the market. However, affordability pressures remain significant, as the indicative monthly cost of ownership has risen 78% since June 2019, while house prices increased by 24% over the same period, according to an e.surv analysis on July 7th.
Despite this, buyer demand has remained relatively resilient, and mortgage approvals have recovered considerably from the disruptions of 2022 and 2023. Regional disparities persist, with Northern Ireland showing the strongest annual growth at 7.4%, while prices in the South-East and London continued to fall by 2% and 1.1% respectively.
The contrarian view
A new report from the Harvard Joint Center for Housing Studies, highlighted on July 7th, flashed a warning signal for the US housing market, pointing to decreasing home demand. The study attributed this slowdown to a decline in household growth, which fell to approximately 1.1 million in 2025.
Furthermore, net international migration is projected to plummet by another 75% in 2026, historically a significant source of housing demand. Dr. Selma Hepp, Chief Economist, suggested that while homeownership interest remains, the affordability crisis hinders many, and increased housing supply is crucial for price reversibility.
What we'll be watching
- US FHFA House Price Index for May 2026 (scheduled for July 28)
- European Central Bank (ECB) policy decisions and their impact on mortgage rates
- Bank of England Monetary Policy Committee meeting (rate cut expectations for November 2026)
- Upcoming Q3 2026 real estate market reports for various regions
- Further developments in China's property market stimulus policies
Reporting + analyst voices: grounded via Google Search at publish time.