US pending home sales hit 2026 low

Pending home sales in the United States fell in July, with contract signings down 2.3% compared with June and 2.2% compared with July a year earlier. The decline pushed activity to its lowest level since January 2026, marking the weakest month for pending transactions so far this year. The data come from the National Association of REALTORS® Pending Home Sales report, which tracks signed contracts on existing homes.

The drop underscores continued strain in the housing market as buyers contend with challenging financing conditions and high price levels. Pending contracts remain well below pre-pandemic norms, reflecting a market where affordability pressures are limiting the pool of active buyers.

All four major U.S. regions posted month-over-month declines in pending home sales in July. The West recorded the sharpest pullback, with a 4.7% decrease from June and a 7.1% decline from a year earlier. The South also weakened, with pending sales down 2.2% month-over-month and 3.0% year-over-year.

In the Northeast, pending sales slipped 2.0% from June and 0.2% from July 2025, indicating relatively smaller year-over-year slippage. The Midwest was the only region to post an annual gain, with pending sales up 1.7% year-over-year despite a 0.7% month-over-month decline. This pattern highlights that, while the slowdown is national, conditions vary by region.

NAR’s chief economist, Dr. Lawrence Yun, said the highest mortgage rates of the year hit in the middle of summer and are pulling back contract signings. Elevated borrowing costs reduce purchasing power, making it harder for potential buyers to qualify for or afford homes at current price levels.

Yun also noted that home prices are at record highs, contributing to longer listing times and fewer buyers bidding above asking prices compared with a year ago. While local markets differ, the combination of high rates and record pricing is cooling demand, as reflected in the latest pending sales figures.

The Pending Home Sales Index is described as a leading indicator for existing-home sales, since signed contracts typically translate into closed transactions in the following months. The latest decline suggests upcoming softness in completed home sales as fewer contracts move through the pipeline.

With pending contracts still well below pre-pandemic levels, the current data signal a housing market that remains constrained by affordability challenges. Unless financing conditions or price trends ease, the subdued pace of contract signings may continue to weigh on overall housing market activity.