Pending home sales fell 7.3% in September and were 11.3% below their level a year earlier, according to the National Association of Realtors.
Every major U.S. region recorded monthly and annual declines, with the West experiencing the steepest losses.
Rising mortgage rates are squeezing buyers’ purchasing power, while relatively few distressed properties are helping keep home prices steady.
The housing market continued to lose momentum in September, as rising borrowing costs made it harder for Americans to buy a home at current prices.
The National Association of Realtors reports that pending home sales fell 7.3% from August and 11.3% from September 2025.
“Market conditions weakened in September due to fast-rising mortgage rates,” said NAR Chief Economist Lawrence Yun. He said changes in mortgage rates have a greater effect on affordability than the support provided by job growth and income gains.
For buyers who need financing, higher rates mean a larger monthly payment for the same loan amount. That can force households to lower their price range, increase their down payment, or postpone a purchase.
Nationwide declines
The slowdown extended across the country. In the West, pending sales dropped 9.2% from August and 15% from a year earlier. The South recorded declines of 8.2% for the month and 12% annually.
Contract signings in the Midwest fell 6.5% from August and 8.7% from September 2025. The Northeast had the smallest declines, but activity still decreased 4.2% monthly and 9.4% annually.
Yun suggested mortgage rates could be nearing a peak, although rising energy costs and inflation leave the outlook uncertain. He said the limited number of distressed properties is helping maintain steady prices despite weaker demand.
Difficult combination
That leaves buyers facing a difficult combination: fewer competing purchasers may improve their negotiating position, but financing costs can still put a home beyond their budget. A seller’s price reduction does not necessarily offset the added monthly expense of a higher mortgage rate.
Pending sales track signed contracts for existing single-family homes, condominiums and co-ops. They generally lead completed sales by one or two months, so September’s pullback suggests a weaker pipeline of closings heading into late fall. Some contracts may also encounter financing, inspection, or appraisal problems before closing.