Pending home sales plunged in September 2026, falling 7.3% from August and 11.3% from a year earlier, as rising mortgage rates weighed on housing demand and discouraged prospective buyers.
The National Association of Realtors (NAR) reported declines in pending home sales across all four major U.S. regions, signaling widespread weakness in contract signings heading into the fall housing market.
The South and West recorded the steepest annual declines, reflecting continued pressure on housing demand as elevated borrowing costs constrain affordability.
Mortgage Rates Weigh on Housing Demand
Higher mortgage rates have increased monthly housing payments, making it more difficult for prospective buyers to qualify for financing and afford home purchases.
Mortgage rates have risen sharply in recent weeks, adding to affordability challenges in a market already characterized by elevated home prices.
NAR Chief Economist Dr. Lawrence Yun said changing mortgage rates were contributing to weaker housing activity, while uncertainty surrounding inflation and the broader economy continued to complicate the outlook.
Despite the decline in contract signings, limited distressed-property inventory has helped support home prices, even as some buyers and sellers postpone transactions.
Pending Home Sales Decline Across All Four Regions
All four major U.S. regions recorded monthly and annual declines in pending home sales in September.
The West posted the largest declines, with pending home sales falling 9.2% from August and 15.0% from September 2025.
The South, the nation’s largest region for existing-home sales, recorded an 8.2% monthly decline and a 12.0% annual decrease.
The Northeast experienced the smallest monthly decline, at 4.2%, while the Midwest recorded the smallest annual decrease, at 8.7%.
Some Metropolitan Markets Show Greater Resilience
Despite the nationwide downturn, several metropolitan areas recorded comparatively smaller annual declines in pending home sales.
Nashville recorded the smallest annual decline among the 50 largest metropolitan areas, followed by Hartford. San Francisco and San Jose also performed comparatively well, although both markets still registered lower contract activity than a year earlier.
A Leading Indicator for Existing-Home Sales
Pending home sales measure signed contracts for existing homes that have not yet closed. Because closings typically follow within one or two months, the index offers an early indication of future existing-home sales activity.
September’s 7.3% monthly decline and 11.3% annual drop suggest that existing-home sales could face additional pressure in the coming months if elevated mortgage rates continue to discourage buyers.
The figures underscore the challenges confronting the U.S. housing market, where financing costs and affordability concerns continue to limit demand despite opportunities for buyers in some markets.
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