Pending Home Sales Tumble to Record Low as Rates Surge
Key Takeaway: National Association of Realtors data shows U.S. pending home sales dropped to a record low in September as fast-rising mortgage rates weighed on the housing sector.
Pending home sales reached their lowest level since 2001, declining 7.3% month-over-month to 66.0 in September, according to the National Association of Realtors. Year-over-year, the index fell 11.3%, and economists polled by Reuters had expected only a 0.5% monthly dip.
The sharp miss followed a 0.3% monthly increase in August. HousingWire reported that the reading was the lowest in the history of the index, which began in 2001. “Market conditions weakened in September due to fast-rising mortgage rates.” said Lawrence Yun, NAR Chief Economist.
Market Conditions and Regional Impact
All four major regions posted monthly declines, with the West falling the most at 9.2% month-over-month and 15.0% year-over-year. The Northeast fell 4.2% and 9.4%, the Midwest 6.5% and 8.7%, and the South 8.2% and 12.0%. Meanwhile, ABC News reported that Census housing starts fell 5.2% month-over-month and 7.4% year-over-year to 1.221 million annualised units in September.
Affordability Constraints and Outlook
Fast-rising mortgage rates drove the downturn, with the 30-year fixed rate averaging about 7.40% last week, according to Freddie Mac via Reuters, and 7.43% on Monday according to Mortgage News Daily via ABC News. “Although job growth and income gains can support home purchases, housing affordability is more affected by changes in mortgage rates.” said Lawrence Yun, NAR Chief Economist.
When rates rise from 6% to 7%, nearly 6 million fewer Americans can afford the monthly payment on the median-priced roughly $435,000 home with 10% down, according to data provided to ABC News by NAR. “Affordability is too stretched, despite the near-stagnation in home prices for the last three years, for the rise in mortgage rates to leave no mark.” said Samuel Tombs, Pantheon Chief U.S. Economist. On the outlook, Yun added: “Given that mortgage rates have already risen much more than the Federal Reserve’s short-term interest rate hikes, mortgage rates could be topping out.” “Buyers and sellers may simply be holding out until mortgage rates move favorably.” he said.
Key Story Metrics
| Figure | Reported Status |
|---|---|
| Pending Home Sales Index, September 2026 | 66.0, lowest since series began in 2001 (NAR) |
| Month-over-month change | -7.3% (NAR) |
| Year-over-year change | -11.3% (NAR) |
| West region | -9.2% MoM / -15.0% YoY (NAR) |
| Reuters economist poll (MoM forecast) | -0.5% vs actual -7.3% (Reuters) |
| 30-year fixed mortgage rate | ~7.40% last week (Freddie Mac, via Reuters) |
| Housing starts, September 2026 | 1.221m annualised units; -5.2% MoM, -7.4% YoY (Census, via ABC News) |
✓ Verified
NAR’s September 2026 Pending Home Sales Index figures (66.0, -7.3% month-over-month, -11.3% year-over-year), the record-low status since the series began in 2001, the regional declines with the West falling most, and the expert quotations are confirmed across NAR, HousingWire, Reuters and ABC News.
⚠ Still needs confirmation
The index is seasonally adjusted using NAR’s X-13ARIMA-SEATS methodology; the October 20 release text does not explicitly label the figures as seasonally adjusted.
Frequently Asked Questions
Which region experienced the worst decline in pending home sales?
The West region experienced the worst decline, falling 9.2% month-over-month and 15.0% year-over-year, according to NAR data.
How many Americans are priced out when mortgage rates rise from 6% to 7%?
Nearly 6 million fewer Americans can afford the monthly payment on the median-priced roughly $435,000 home with 10% down, according to NAR data provided to ABC News.
Could mortgage rates be topping out?
NAR Chief Economist Lawrence Yun said rates ‘could be topping out’ because they have already risen much more than the Federal Reserve’s short-term interest rate hikes.
- National Association of Realtors: Pending Home Sales Decreased 7.3% in September (20 Oct 2026)
- HousingWire: NAR pending home sales index falls to record low in September (20 Oct 2026)
- Reuters: US pending home sales tumble to record low in September (20 Oct 2026)
- ABC News: Americans are struggling to buy homes amid rising costs (20 Oct 2026)
Editor’s note: Figures reflect data released through 21 October 2026. This article explains market data and is not financial advice.
