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the housing market in Vermont

Vermont Housing Market Trends & Forecast [2026]

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.

Vermont Housing Market Overview

Known for its vast acres of forest, Vermont is a state in the northeastern United States that shares a border with Canada. Vermont thrives on a variety of different industries, but according to data from IBISWorld, Real Estate, Rental, and Leasing was the sector that contributed the most to the state’s 2026 GDP. A further look into the notable housing market in the state is more than worthwhile.

The state’s housing market continues to be shaped by a long-running shortage of available homes, especially affordable ones, which has tightened competition and put pressure on prices across many parts of the state. Vermont’s latest statewide housing needs assessment says the shortage has grown more severe in recent years, driven by low vacancy, elevated construction costs, and a pace of homebuilding that has not kept up with demand.

While borrowing conditions have improved from the sharp rate spikes seen in recent years, affordability is still a major issue for Vermont households. National mortgage rates have eased from their recent highs, but state housing officials and advocates continue to describe Vermont’s market as constrained by undersupply rather than fully relieved by financing changes alone. In other words, even as the broader rate environment becomes somewhat more favorable, limited inventory remains one of the biggest forces shaping Vermont’s housing market.

Vermont Market Trends

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

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

Median Home Price

The median price of a home in Vermont as of February 2026 was $412,200, according to Redfin’s monthly housing market data. This is an increase of 6.9% from February 2025, accurately reflecting predictions of continually increasing housing prices in the state. In Burlington, the most populous city in the state, the median price is significantly higher at $425,000. This February 2026 statistic actually represents an 18.2% decrease in median price from February 2025.. This is a demonstration of how statewide aggregate data is pulling from a diversity of housing markets that are experiencing a variety of factors and influences.

Number of Homes Sold in February 2026

367 homes were sold in Vermont in February 2026, which is a slight decrease of only 10 homes from 2026. This number can be expected to increase in the summer months. It is important to keep in mind that 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%.

Despite this, the number of home sales from the previous years have failed to reach the same peaks that were recorded in the summers of 2020 and 2021.

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 median DOM in Vermont in February 2026 was 106 days, which is an increase of 13 from the previous year. This means that, on average, listings spend around a three and a half months on the market before being purchased. An increase from the previous year potentially suggests a market that is increasingly favoring buyers.

New Supply Statistics

Vermont’s housing supply remains constrained. The latest full-year federal data show the state issued 2,654 residential building permits, or about 4.1 permits per 1,000 residents based on Vermont’s 2024 population estimate of 648,493. Even so, new construction is still falling short of what the state needs: Vermont’s 2025–2029 Housing Needs Assessment estimates the state needs 1,200 to 3,400 additional homes per year above its current building pace to close supply gaps and meet demand.

Property Tax Rate

According to Rocket Mortgage, the average property tax rate in Vermont is 1.83%. This is one of the highest average rates in the country, lower than only three other states. The average annual property tax in the state is around $9,119.74. As previously mentioned, it is important to keep I mind that this statistic reflects the average of a lot of data in a state with geographic and economic diversity. Tax rates are likely to vary depending on the value of a home and its location in the state.

Foreclosure Rate in January of 2026

In January of 2026, 1 in every 33,904 homes in Vermont experienced a foreclosure filing, according to recent data from ATTOM. This is the second lowest rate in the country, meaning that extremely few homeowners experience foreclosure in the state.

Hottest Local Markets in Vermont

1. Burlington

By a very significant margin, Burlington is the city in Vermont with the highest population. Located in the northwest, the city’s housing market is very different from statewide data. As previously mentioned, its median housing price in February of 2026 is $425,000, which represented an 18.2% decrease from 2026. Its median DOM is 103, which has gone up from 73 in the past year, and this suggests an incredibly competitive seller’s market when compared to the statewide median DOM. Some of the most popular neighborhoods in Burlington are New North End, South End, and Old North End.

2. South Burlington

Not to be confused with its neighbor to the northwest, South Burlington is the second most populated city in Vermont behind Burlington. Its median home price in February 2026 was $665,000. This number represents a 1.7% decrease from 2026. Its median DOM of 47 is significantly smaller than the statewide median, however, and is an overall decrease of 9 from 2025. This suggests that the housing market is relatively competitive and stable. Some of the most popular neighborhoods in South Burlington are South Burlington South and South Burlington North.

3. Essex Junction

Also in northwestern Vermont, Essex Junction has a smaller population than Burlington and South Burlington, but it remains one of the state’s more competitive housing markets. Redfin rates Essex Junction as very competitive, with a Compete Score of 84, and reports that homes sold in about 33 days in February 2026. At the same time, the city’s median sale price was $438,000, down 30.0% year over year, showing that prices can still swing sharply even in a competitive market. Redfin also identifies nearby popular areas including Colchester Village, Williston North, South Burlington North, and Colchester.

Economic Factors Impacting the Vermont Housing Market

A holistic view of Vermont’s housing market requires a basic understanding of the main economic drivers affecting the market.

It’s important to note that the escalated costs of newly built homes in Vermont have made affordable or market-rate housing increasingly scarce, with the growth of multimillion-dollar properties outpacing other segments. The Vermont Housing Finance Agency (VHFA) has analyzed home prices and sales, highlighting the lack of affordable housing and its impact on the state's economy.

Mortgage Rates

Mortgage rates remain a major affordability factor for buyers in Vermont, even though they have eased from the highs seen in recent years. As of March 2026, Bankrate reports Vermont’s average 30-year fixed mortgage rate at 6.41%, which suggests borrowing costs are still elevated by pre-2020 standards but more stable than during the sharp rate volatility of 2023 and 2024. Nationally, Freddie Mac reported the average 30-year fixed-rate mortgage at 6.11% for the week ending March 12, 2026, showing Vermont is tracking somewhat above the national average. Overall, mortgage rates have come down from their recent peaks, but they are still high enough to weigh on affordability and buyer demand in 2026.

Inflation and Cost of Living

Mortgage rates are tied to inflation, another massive contributing factor to the affordability of housing and the state of housing markets in general. Inflation has increased the cost of living for many across the U.S., including in Vermont. This means fewer people can truly afford to limit housing costs to less than 30% of their monthly income.

Population Changes and Demographics

A changing population can also have implications for the housing market. According to the U.S. Bureau of Labor Statistics, the unemployment rate in Vermont is 2.6%. This rate is one of the lowest in the country in 2026, higher than only North Dakota, South Dakota, and Hawaii. This low unemployment rate signifies a healthy and thriving economy that is bound to draw more workers and prospective homeowners in the future.

Vermont Housing Market Forecast 2026

Vermont’s housing market is expected to remain tight in 2026. Recent data show home prices are still rising, but growth appears more moderate than during the pandemic-era surge, suggesting a market that is still appreciating without accelerating at the same pace. The bigger issue continues to be supply: Vermont’s latest housing needs assessment says the state remains structurally undersupplied, so even if demand cools somewhat, limited inventory is likely to keep prices relatively firm.

Likelihood of Vermont Housing Market Crash

A major housing market crash in Vermont appears unlikely in the near term. While affordability remains a challenge and sales activity has softened in some periods, the state’s long-running housing shortage creates a floor under prices that many overheated markets do not have. In other words, Vermont looks more likely to see continued pressure, uneven price growth, or localized slowdowns than a broad statewide collapse.

Forecast for the U.S. Housing Market

Now that we’ve looked at Vermont’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 U.S. housing market in 2026 is expected to remain relatively stable, but it is unlikely to become easy for buyers anytime soon. Mortgage rates have come down from the peaks seen in recent years, which has helped improve affordability somewhat. Freddie Mac reports the average 30-year fixed-rate mortgage at 6.11% for March 2026, down from 6.65% a year earlier. That decline should help support buyer activity, especially during the spring selling season, even though borrowing costs are still well above the ultra-low levels many buyers became used to earlier in the decade.

Recent sales data suggest the market is improving gradually rather than rebounding sharply. The National Association of Realtors reported that existing-home sales rose 1.7% in February 2026, while pending home sales increased 1.8% month over month. At the same time, pending sales were still down 0.8% year over year, which shows that demand is recovering, but not surging. In other words, the most likely national trend for 2026 is modest improvement in activity rather than a dramatic comeback.

Home prices are also expected to keep rising, but at a slower pace than in the overheated years of the pandemic market. According to Fannie Mae’s Home Price Expectations Survey, experts forecast national home price growth of 2.1% in 2026, following 2.4% in 2025 and 5.3% in 2024. That points to a market where prices are still appreciating, but in a more moderate and sustainable way.

Overall, 2026 looks more like a year of adjustment than a year of major correction. Lower mortgage rates and gradually improving affordability should help bring more buyers and sellers back into the market, but tight inventory and still-high monthly housing costs will likely keep conditions competitive in many areas. Rather than a nationwide crash, the more likely outcome is a slower, uneven market where price growth cools, sales improve modestly, and affordability remains one of the biggest challenges shaping the housing market.

Vermont Rental Market 2026

Vermont’s rental market remains tight in 2026, with limited availability continuing to put pressure on prices across much of the state. The Vermont Housing Needs Assessment says the state’s renter vacancy rate was just 4% in 2022, below the 5% rate typically considered a healthier balance, and projects that Vermont could add nearly 15,000 renter households between 2025 and 2029 if recent household growth trends continue. That means demand for rental housing is likely to keep outpacing supply unless the state adds significantly more units.

This short summary leads directly into Vermont’s current rental market.

Rent levels also reflect that pressure. HUD’s FY 2026 Fair Market Rent for a two-bedroom apartment ranges from $1,381 in the nonmetro parts of Vermont to $2,018 in the Burlington-South Burlington metro area, highlighting just how expensive many parts of the state have become for renters. Overall, Vermont’s rental market in 2026 is best defined by low supply, persistent affordability challenges, and continued demand growth.

Below are just a few of the current trends for Vermont’s rental market based on data pulled from Zillow:

Vermont Rental Market Key Trends

• Median rent: $2,036
• Month-over-month rent change: +$20
• Year-over-year rent change: -$64
• Available rentals: 1,236

Conclusion

Vermont’s housing market remains defined by one central issue in 2026: too little supply for the level of demand. Home prices are still rising statewide, rents remain elevated, and the state’s latest housing needs assessment makes clear that Vermont will need a major increase in year-round housing production to ease affordability pressures. Rather than pointing to a crash, current data suggest a market that is still constrained, competitive, and expensive for both buyers and renters.

FAQs

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

Vermont still leans competitive because supply remains limited, but conditions are not as frenzied as they were during the pandemic-era housing boom. Homes are taking longer to sell than they did a year ago, which suggests a somewhat more balanced market, even though prices are still increasing statewide.

Are home prices dropping in Vermont?

Not at the statewide level. Redfin reported that Vermont’s median home sale price was up 6.9% year over year in February 2026, although individual cities and neighborhoods may see more volatility than the state as a whole.

Why is housing so expensive in Vermont?

A major reason is undersupply. Vermont’s latest housing needs assessment found that the state needs tens of thousands of additional year-round homes to meet demand, normalize vacancy rates, and replace homes lost from the housing stock. When supply stays that tight, both home prices and rents tend to remain elevated.

Is Vermont building enough new housing?

No. While new construction is happening, the state’s housing needs assessment indicates current building levels are still well below what is needed to close the gap. Vermont will need a sustained increase in homebuilding over the next several years to make a meaningful difference in affordability.

What is the outlook for Vermont renters in 2026?

Vermont renters are likely to keep facing a tight market. The state’s housing needs assessment estimates Vermont needs 16,000 to 20,000 additional rental homes between 2025-2029, and HUD’s FY 2026 fair market rent data show that rents remain especially high in and around Burlington