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It is estimated that 6.5 million Americans will retire in 2026. Are you one of them too? If so, you’ve probably already started considering where to settle down and spend your golden years. Some people may be considering buying a home for their retirement.
Before you take the leap, it’s good to know which housing markets are expected to be strong and which are expected to be unaffordable in 2026. To determine the best 20 and worst 20 Housing market for retirees In 2026, GOBankingRates sourced various markets from Zillow Research Data and cross-referenced that information with U.S. Census household values ​​and retirement income levels. From that matrix, GOBankingRates was able to identify the 20 best housing markets for retirees in 2026 and the 20 housing markets to avoid when retiring in 2026.
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Main findings best market
- The Midwest dominated the top 20, with 15 of the top 20 retirement housing markets in 2026 concentrated in cities in Illinois, Indiana, Michigan, Ohio, and Wisconsin.
- Ohio dominates the market: Ohio has more cities in the top 20 with five entries than any other state (Michigan ranks second with four).
- Retirees are flocking to Sandusky, Ohio. Approximately 32.9% of Sandusky households receive retirement income, more than any other city in the top 20. As a result, Sandusky has become a boomtown for retired homeowners.
1. Saginaw, Michigan
- Predicted one-year change in home value: 4.9%
- Percentage of households with retirement income: 32.9%
- Percentage of income needed for new home: 22%
- Income needed to buy a new home: $48,048
A “For Sale” sign on a home in Philadelphia, Pennsylvania, on Friday, August 16, 2024. (Joe Lamberti/Bloomberg via Getty Images/Getty Images)
2. Mansfield, Ohio
- Predicted 1-year change in home value: 0.11%
- Percentage of households with retirement income: 4.5%
- Percentage of income needed for new home: 20%
- Income needed to buy a new home: $47,546
3. Kokomo, Indiana
- Predicted one-year change in home value: 4.2%
- Percentage of households with retirement income: 32.2%
- Percentage of income needed for new home: 22%
- Income needed to buy a new home: $49,883
4. Bay City, Michigan
- Predicted one-year change in home value: 4.2%
- Percentage of households with retirement income: 31.7%
- Percentage of income needed for new home: 22%
- Income needed to buy a new home: $49,692
5. Midland, Michigan
- Predicted one-year change in home value: 4.3%
- Percentage of households with retirement income: 33.9%
- Percentage of income needed for new home: 23%
- Income needed to buy a new home: $62,612
A for sale sign is posted outside a home for sale in Los Angeles, California on August 16, 2024. This location ranks as one of the worst markets for retirees. (Patrick T. Fallon/AFP via Getty Images/Getty Images)
Key findings about the worst markets
- California’s housing market is the worst: California has one of the most unfriendly housing markets for retirees. Especially San Jose.
- The Golden State dominates the bottom 20: Not only will California have the worst retirement housing market in 2026, its cities will account for the majority of the bottom 20 markets, with 11 cities in total.
- Hawaii also poses challenges for retirement. Frequently ranked as one of the most expensive states in the United States, Hawaii has two of the worst housing markets for retirees in 2026: Honolulu and Kahului.
1. San Jose, California
- Predicted one-year change in home value: 0.8%
- Percentage of households with retirement income: 18.9%
- Percentage of income needed for new home: 62%
- Income needed to buy a new home: $368,861
These 10 markets could see the biggest surge in home purchases as mortgage rates fall
2. San Francisco, California
- One-year forecast for home value change: -1.6%
- Percentage of households with retirement income: 22.2%
- Percentage of income needed for new home: 56%
- Income needed to buy a new home: $268,428
3. Santa Cruz, California
- Predicted one-year change in home value: 1.2%
- Percentage of households with retirement income: 25.8%
- Percentage of income needed for new home: 70%
- Income needed to buy a new home: $266,158
Cityscape of Los Angeles on a sunny day with views of office buildings and neighborhoods. (Simon Kul/Getty Images)
4. Los Angeles, California
- Predicted one-year change in home value: 1.2%
- Percentage of households with retirement income: 17.9%
- Percentage of income needed for new home: 67%
- Income needed to buy a new home: $226,556
5. Salinas, California
- Predicted one-year change in home value: 0.4%
- Percentage of households with retirement income: 22.4%
- Percentage of income needed for new home: 61%
- Income needed to buy a new home: $200,578
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Methodology: New Homeowner Affordability, New Homeowner Income Requirement, Zillow Home Value Forecast, and Zillow Home Value Index were derived from Zillow Research data for each housing market. Households with retirement income were obtained from the 2023 U.S. Census 5-Year ACS. One-year home value projections were scored and weighted at 1.00, percentage of homes receiving retirement income was scored and weighted at 1.00, affordability for new homeowners was scored and weighted at 1.00, and income needed for new homeowners was scored and weighted at 1.00. All data sourced and compiled on December 18, 2025.
