Learn more about the housing market in Delaware

Every state is unique when it comes to the real estate market. That’s why it’s critical to understand the market you live or operate in. Whether you’re renting, buying, or selling, it will impact many aspects of your life.  

Key Takeaways

1. Low inventory continues to keep Delaware a seller-leaning market despite slower sales activity.
2. Mortgage rates around the mid-6% range are the main affordability constraint for buyers.
3. Tax advantages and proximity to major cities support steady migration and demand.
4. Home prices are stabilizing, not crashing, due to tight supply and consistent population growth.

Delaware Housing Market Overview 

Delaware, the first state to ratify the Constitution, continues to attract residents and businesses thanks to its favorable tax structure and proximity to major employment hubs like Philadelphia, Baltimore, and Washington, D.C. The state’s population has steadily grown, reaching roughly 1.05 million residents in 2025, driven partly by migration from higher-cost Northeast markets.

What should buyers and sellers know about the health of the Delaware housing market?  

For buyers and sellers, the main story in 2026 is tight housing supply. Like much of the country, Delaware has experienced low inventory as mortgage rates near the mid-6% range keep homeowners “rate-locked” into existing loans, reducing listings. While new construction has increased somewhat, it has not fully offset demand, leaving many markets competitive and limiting buyer choice

Demand is supported by Delaware’s affordability relative to nearby metros. Home prices remain below those in neighboring New Jersey and southeastern Pennsylvania, and the state has one of the lowest property tax burdens in the U.S., averaging well under 1% of home value. Combined with a cost of living lower than major Northeast cities, this has continued to attract households seeking suburban access to regional job centers.

In short, Delaware’s housing market is shaped by steady in-migration, limited supply, and relative tax advantages meaning buyers face competition, while sellers benefit from persistent demand even as higher rates slow transaction volume.

Delaware Housing Market Trends 

To understand the Delaware real estate market, it’s important to keep up with trends. Let’s look at some key ones in Delaware: 

Note: These statistics are based on Redfin’s monthly housing data from January 2026. 

Median Home Price 

The median sale price for a home in Delaware in January 2026 was $366,600. This marks a 7.9% year-over-year increase and puts Delaware on the lower end of home prices, according to Redfin’s monthly housing data.  

Number of Homes Sold in January 2026

There were 474 homes sold in Delaware this April, down from 567 sold in January of 2025. About 25.1% of homes sell above list price However, keep in mind that this number might be deflated compared to other months since nationally speaking, sales usually peak during the spring and summer months and slow in the winter. In fact, the National Association of Realtors (NAR) predicts that in February and March alone, sales activity increases by as much as 34% and prices by 3%. 

Median Days on Market (DOM) 

Days on market (DOM) is a measure of the average length of time a home remains listed on the market before being put under contract. A lower DOM signals a highly competitive seller’s market with more pressure on buyers to make higher offers and remove contingencies. A higher DOM signals a buyer's market as sales are slower and sellers have less leverage. 

The current median days on market (DOM) in Delaware is 51 days. The nation’s average is around two months according to Redfin, so Delaware is quicker overall. This indicates that it’s a seller’s market, since homes tend not to stay on the market for very long. It most likely is due to the low supply in the state, with only a 3 months' supply.  

An area’s housing market supply measures how long it would theoretically take for all the homes in a particular housing market to sell. If the supply is at 6 months, the market is considered balanced. Since the housing market supply in Delaware is currently hovering around only two months, the state is heavily favoring sellers.  

New Supply Statistics 

Housing inventory in Delaware has gradually improved but remains limited overall. Active listings have increased compared to the tightest pandemic years, giving buyers slightly more choice, though supply still falls short of a balanced market. Newly listed homes have also trended upward as some owners begin moving despite higher mortgage rates.

New construction has played a growing role in meeting demand. Building permits and housing starts have risen in recent years as builders respond to persistent inventory shortages. Because resale options remain constrained, many buyers are turning to newly built homes for modern layouts, energy efficiency, and planned community amenities, making new construction an increasingly important share of Delaware’s housing supply rather than a niche alternative.

Property Tax Rate 

The average property tax rate in Delaware is currently at 0.61%, according to Rocket Mortgage. The median home price in Delaware is now roughly in the mid-$300,000 range, and homeowners benefit from one of the lowest property tax burdens in the country. The state’s effective property tax rate averages about 0.55% of a home’s value, meaning a typical homeowner pays only a few thousand dollars annually depending on county assessments (  

Delaware continues to attract both residents and investors because of its favorable tax structure. The state has no statewide sales tax and consistently ranks among the lowest property tax states nationwide, while also maintaining business-friendly corporate laws that make it a major incorporation hub. These tax advantages help offset housing costs compared with neighboring Mid-Atlantic states.

Foreclosure Rate in Q1 of 2026 

Delaware has the highest foreclosure rate in the nation with one in every 1,612 housing units experiencing foreclosure in the first quarter of 2026, according to ATTOM. Since the last quarter of 2025, this is an increase of nearly 29%., ranking it first in the country. n many cases, these filings also reflect the continued clearing of loans that fell behind during the pandemic rather than a surge of brand-new financial distress.

The Mideast was the region with the most representation among the top 10 foreclosure states. Delaware, New Jersey, and Maryland all found themselves in this group. A contributing factor to this rise in foreclosures could be rising property tax assessments, since home values in this area have swiftly increased, making even low mortgage rates unaffordable.  

Hottest Local Markets in Delaware 

1. Middletown

Middletown home prices dropped 9.7% compared to last year, selling for an average price of around $395,000. The number of homes sold in this area stayed stable at 21 homes sold in January.

Redfin characterizes this market as somewhat competitive, with houses going pending in around 58 days and hot homes selling as fast as 29 days. Some houses may even go pending in around 7 days, and some get multiple offers with waived contingencies. 

2. Dover

The capital of Delaware is the second-most populated city in the state and is seeing a fair amount of growth in its housing market. Home prices are down 12.7% from last year and sell on average at $275,000.  

Dover is very competitive, with homes going pending on average after 46 days, with some going pending in only five days. Dover is a more desired area in Kent County, seeing as its neighbors Camden and Wyoming do not tend to sell homes above list price and either sell at list price or below.  

Economic Factors Impacting the Delaware Housing Market 

A holistic view of Delaware’s housing market requires a basic understanding of the main economic drivers affecting the market. Let’s look at a few critical ones below: 

Mortgage Rates 

As of early 2026, the average 30-year fixed mortgage rate in Delaware is roughly about 6.1%, while 15-year fixed rates are around 5.3%–5.5% depending on lender and borrower profile.

From these numbers, Delaware’s mortgage rates are high but not as high as the national average. High mortgage and interest rates discourage many homeowners from listing their properties for fear that their new rates will be higher than their current, contributing to the low supply we see in many states and cities across the nation. Prospective buyers in the Delaware market should continue to monitor the mortgage rates for a better understanding of how they impact the housing market and their ability to afford a home. 

Inflation and Cost of Living 

Delaware’s cost of living sits very close to the national average today. Estimates place the state’s overall cost-of-living index around 103, meaning expenses are roughly 1 to 3% higher than the U.S. average depending on the dataset used. Housing is near the national average while groceries and utilities tend to run slightly higher.

Prices are still noticeably higher than before the pandemic. Since 2021, U.S. consumer prices have risen about 19.6% cumulatively, meaning a dollar today buys only about 84% of what it did in 2021. Even though inflation cooled to 2.7% annually in 2025, households continue paying more each month for the same goods and services.

Because incomes have not increased at the same pace everywhere, many households still struggle to keep housing costs below the recommended 30% of income threshold.

Population Changes and Demographics 

Population and migration trends continue to influence Delaware’s housing demand. The state’s population reached about 1.05 million residents in 2024, growing 21% since 2010, with Sussex County seeing the fastest growth due to retiree and coastal migration. Delaware is geographically small and this steady growth contributes to relatively high population density and sustained housing demand.

Employment growth has also supported housing activity. Delaware’s labor force and job base expanded following the pandemic recovery, while the state maintains an older-than-average homebuying population. Nationally, the median homebuyer age recently climbed to a record 56 years, reflecting a shift toward older buyers and retirees in lower-cost states and coastal markets.

Together, steady population growth, migration from higher-cost regions, and an aging buyer demographic continue to drive housing demand in Delaware even as overall sales volume fluctuates with mortgage rates.

Delaware Housing Market Forecast 2026 

What can you expect from the Delaware housing market forecast 2026? While some experts say mortgage interest rates will most likely stay above 6%, they’re expected to stabilize rather than fluctuate as they have been for the past couple years. When those mortgage rates stabilize, it could encourage more buyers to enter the market, especially if inflation starts to ease.  

Delaware is unique due to its appeal to housing investors. With its advantageous East Coast location and its low property tax, landlords are more inclined to look in this area for investment properties. Hopefully this interest will help the general return of the buyer and kickstart the housing market from its sluggish start in 2026. 

Likelihood of Delaware Housing Market Crash  

A major housing “crash” in Delaware in 2026 looks unlikely, but the state is showing more stress than most. Delaware had the highest foreclosure rate in the U.S. in January 2026 at 1 in every 1,612 housing units (288 filings), which signals pockets of homeowner strain.

That said, today’s conditions still don’t resemble 2008. Inventory remains relatively tight and mortgage underwriting has been far more conservative, which helps prevent the kind of speculative oversupply that drove the last crash. High rates have cooled demand, but they’ve also kept many homeowners “rate-locked,” limiting listings and supporting prices. Mortgage rates have started easing again, with the average 30-year fixed rate around 6.01% in mid-February 2026.

The bigger risk for Delaware is affordability pressure, not a statewide price collapse: delinquency rates ticked up nationally in late 2025, and Delaware’s elevated foreclosure rate suggests more households are getting squeezed by total monthly costs.

Forecast for The U.S. Housing Market 

Now that we’ve looked at Missouri’s housing market, let’s zoom out a little bit. What about the U.S. housing market? What do you need to keep an eye on in the coming years? 

The United States' current median existing-home sale price is around $415,200 per the National Association of Realtors. The inventory, though, remains low. A balanced market typically has a 5-to-6-month supply, but the current figure is 3 months, keeping conditions constrained.

We’re currently in a seller’s market with buyers looking at continued rising house prices—although they are rising at a slower pace compared to previous years.. The same trend can be seen with renters. Housing continues to appreciate, in general.

Dr. Lawrence Yun, Chief Economist and Senior Vice President of Research, National Association of Realtors, believes the housing market will appreciate 15 to 25% over the next five years. He thinks that the seller’s market will continue because housing inventory will remain low. In 2026, he predicts that existing home sales will rise an additional 13%. Yun expects mortgage rates to stabilize at the lower end of the current 6-7% range through 2025 and 2026 as the Federal Reserve continues gradual rate cuts. There's an anticipation of a more balanced market in the coming years, with moderate price growth and a greater amount of Americans re-entering the market.

Hybrid work also impacts the housing market. This shift in work culture means suburbia will continue to grow. States like Texas, the Carolinas, Tennessee, and Florida should see continual growth.

The number of single-family homes built decreased over the past couple years while the number of multi-family homes increased due to lower prices and a demand for affordable housing. Year-to-date single-family housing starts were down about 7.1% in 2025, whereas starts for buildings with five or more units were up roughly 14.5% Higher mortgage rates and inflation (affecting price of materials) were the main causes.

Lower income households continue to struggle in the current housing market. This trend appears likely to continue into the foreseeable future. According to the National Association of Home Builders, approximately 74.9% of U.S. households were unable to afford a newly built median-priced home in 2025. Without enhanced supply or helpful subsidies, the outlook is that many Americans will still wrestle with housing affordability in the years to come.  

Delaware Rental Market 

Delaware’s rental market remains tight in 2026 as high home prices and mortgage rates keep many households renting longer. With borrowing costs still near 6%, fewer first-time buyers are entering the market, which sustains renter demand and keeps vacancy rates relatively low across much of the state.

Rents in Delaware sit close to the national average but vary widely by location. Coastal and commuter areas like Sussex County and northern New Castle County tend to see the strongest demand due to retirees and workers commuting to Philadelphia and nearby job centers. This steady in-migration has helped keep rents elevated even as national rent growth slowed after the pandemic surge.

Affordability remains a concern. A significant share of renters spend more than 30% of income on housing, reflecting a broader supply shortage of smaller and moderately priced units. New apartment construction has increased modestly in recent years, but not enough to fully offset demand, so rents have generally stabilized rather than fallen.

This short summary leads directly into Delaware’s current rental market, with key trends from Zillow: 

Delaware Rental Market Key Trends 

• Median Rent: $1,950 

• Month-over-month Change: $0 

• Year-over-year Change: -$40 

• Available Rentals: 1,164 

Conclusion 

Delaware’s 2026 housing market is defined by steady demand, limited inventory, and relative affordability compared to nearby Northeast metros. Buyers face competition and ongoing affordability pressure, while sellers benefit from persistent interest despite slower transaction volume. Rather than a boom or bust cycle, the state is experiencing a constrained but stable market shaped largely by mortgage rates, migration, and housing supply.

FAQs

Is Delaware a buyer’s or seller’s market in 2026?

It leans toward sellers because housing supply remains below a balanced level.

Are home prices expected to fall in Delaware?

Major declines are unlikely since steady demand and limited listings support prices.

Why do people move to Delaware for housing?

Many relocate for lower property taxes and proximity to major East Coast job centers.

Is Delaware good for real estate investing?

It can be attractive because stable demand and tax advantages help maintain long-term rental occupancy.

Will mortgage rates affect the Delaware market?

Yes, even small rate changes significantly impact affordability and buyer activity.