Many years ago, when my sons were in Cub Scouts, they had a local TV weather forecaster as a guest speaker. In those days, long before artificial intelligence, one of the parents asked the weatherman how far in advance, with computers and Doppler radar, he could accurately forecast the weather. His answer was not in weeks or days. It was six hours.

Today it seems we can forecast economic activity only until the next tweet changes everything. In my January 2026 Intown Market Report, I made the following statement:

“Interest rates appear poised to drift slightly below 6%, which may bring more buyers into the market. While it is a long way to December 31, 2026—and much can happen that will affect the Intown Atlanta market—being an optimist, I believe the positives still outweigh the negatives. I see the glass as half full.”

In the world of forecasting, an event that suddenly changes everything is called a Black Swan event. September 11, 2001, attack on the World Trade Center and the 2020 COVID-19 pandemic are good examples. The US war with Iran, which began in February, is not a Black Swan event, but it could be categorized as more of a “Gray Swan” event.

Interest Rates & Financial Analysis

The 10-year Treasury rate, which serves as a benchmark for mortgage rates, among others, increased from 3.97% on February 27, 2026, to 5.28% as of October 2, 2026. On February 27, the average 30-year mortgage rate was 5.98%. Today, it is 7.49%.

In our October 2026 Intown Market Report, the average sales price for the overall market is $904,102. For a theoretical buyer with a 10% down payment, the loan amount would be $813,692:

At last February’s rate of 5.98%: The monthly payment for a 30 year loan would be $4,868. A borrower would pay $938,801 in interest over the life of the loan.
At today’s rate of 7.49%: The monthly payment is $5,684, an increase of $816 per month, or $9,792 per year. The borrower would pay $1,232,505 in interest over 30 years, a difference of $293,704.

Higher interest rates mean fewer potential buyers qualify for mortgages, resulting in fewer home sales. As we enter the fourth quarter of 2026, the market, which has been solid for most of the year, is likely to weaken as we approach the holidays.

One cannot blame the current state of the mortgage market solely on the Iran war. There are other culprits, including our $40 trillion national debt. However, the debt and those other culprits were issues back in February, when rates were lower. If war were to end suddenly, rates would probably fall. I personally believe the nation’s credibility, which Treasury bondholders depend on, has been damaged, and when rates do fall, they will not return to where they were in late February 2026.

Overall Market Stats

Average Sales Price: $904,102 (an 8% annual increase and a 15% increase over the last 24 months)
Average Days on Market: 49 days stayed on the market (a year-over-year increase of 17% and 29% longer than two years ago)
Properties Sold: 1,394 properties have sold over the last 12 months (a 1% decrease in the last year and a 9% decrease over the last 24 months)