Key facts
- Pending home sales decreased by 2.3% in July compared to June.
- Year-over-year, pending home sales were down 2.2%.
- Contract signings declined in all four major U.S. regions on a monthly basis.
- The Midwest was the only region to see an annual increase in pending home sales.
- Virginia Beach-Chesapeake-Norfolk led major metros with a 17.2% year-over-year increase in pending sales.
Pending home sales weakened in July, falling 2.3% from the previous month and 2.2% year-over-year, reaching their lowest point since January 2026. The National Association of Realtors attributed the decline to elevated mortgage rates and record home prices, which are impacting affordability.
Contract signings saw month-over-month declines in all four major U.S. regions. Annually, the Midwest was the only region to record an increase in pending sales, while the Northeast, South, and West experienced decreases. The West saw the sharpest annual drop, with sales falling 7.1% from July 2025.
Despite the overall slowdown, several major metropolitan areas reported notable year-over-year gains. Virginia Beach-Chesapeake-Norfolk led with a 17.2% increase, followed by San Antonio-New Braunfels at 11.8% and Cincinnati at 6.2%. Other metros like Pittsburgh, Miami, and Austin also recorded annual gains.
NAR Chief Economist Dr. Lawrence Yun noted that the highest mortgage rates of the year occurred during summer, impacting contract signings. He also pointed out that while home prices are at record highs, houses are sitting on the market longer, and fewer buyers are bidding above asking price compared to a year ago, though local market variations exist.
Yun expressed optimism that employment growth and improving mortgage rates could eventually draw more buyers back, citing a significant gap between pre-pandemic contract levels and current payroll employment as evidence of pent-up demand. He anticipates this demand could be unleashed as market supply increases and affordability improves.