Zillow says housing market is cooling, but regional demand varies

April’s new-home market was the softest for that month since 2022, a sign that Home Depot teams should expect demand to stay uneven rather than simply weaker across the board. Zillow said new-home sales ran at a seasonally adjusted annual rate of 622,000 in April 2026, down 11.3% from a year earlier, while the supply of new homes for sale rose to 489,000 units, equal to 9.4 months of supply.

That kind of slowdown usually matters most on the floor when mortgage rates stay stuck high enough to delay move-up purchases and big remodels. Freddie Mac said the 30-year fixed-rate mortgage averaged 6.53% as of May 28, after averaging 6.51% a week earlier, reinforcing the affordability squeeze that has kept many would-be buyers on the sidelines. Zillow said mortgage rates had stalled after reaching a nine-month high, with lingering inflation and rate uncertainty weighing on housing momentum.

The more useful story for store managers is that the market is not cooling evenly. Zillow said home sales rose the most year over year in Austin, where inventory is 52% above pre-pandemic averages and homes are typically selling after 17 days. Zillow also said inventory has fully recovered in 19 major metros, concentrated in the South and West. In those places, more listings and faster turnover can mean more moving-related spend, more closing-week urgency, and more demand from contractors and Pro customers handling punch lists, repairs, touch-ups, and appliance swaps.

Elsewhere, a slower market can tilt spending toward maintenance and smaller refreshes instead of full-scale renovations. Zillow’s April market report said new listings topped 426,000, up 2.1% from a year earlier, while home sales were down 0.4% and active inventory rose 3.7% to 1.3 million homes nationwide. That mix suggests a broader split in customer intent: some shoppers are tied to a move, sale, or rental turnover, while others are staying put and choosing projects that preserve value without taking on a new mortgage.

Home Depot’s own first-quarter fiscal 2026 results fit that mixed backdrop. The company reported sales of $41.8 billion, up 4.8% from a year earlier, with comparable sales up 0.6% and U.S. comparable sales up 0.4%. For associates and department leads, the lesson is to watch the local housing story as closely as the national one. In a market like this, the strongest aisle mix may come from knowing whether your store is serving a metro with more listings and faster turnover, or one where customers are still choosing repairs, refreshes, and maintenance over major projects.