Pending home sales plunged 7.3% in August, dropping to 66—roughly one‑third below the 2001 benchmark of 100.
West Leads Decline, Nationwide Drop Continues
The West fell 9.2% month‑over‑month and 15% year‑over‑year, while the South slipped 8.2% and 12%, the Midwest 6.5% and 8.7%, and the Northeast 4.2% and 9.4%.
Lawrence Yun, chief economist at the National Association of Realtors, said fast‑rising mortgage rates weakened the market in September, even as job growth and income gains kept demand alive.
Freddie Mac data showed the 30‑year fixed rate climbing from 6.71% on Sept. 3 to 7.40% on Oct. 15, the highest level in nearly three years.
Yun warned rates may be nearing a peak but noted rising energy prices could keep inflation pressures elevated.
Chen Zhao, Redfin’s head of economic research, said rates above 7% have priced many buyers out, causing the steepest monthly decline in pending sales in more than three years.
Redfin’s Oct. 12 report found pending contracts fell 4% from August, reaching the lowest level since spring 2014, excluding the pandemic‑induced dip in April 2020.
Nearly 20% of sellers cut asking prices in September, and 60.5% of homes sold for less than their original list price.
Inventory Rises, Giving Buyers More Leverage
Existing‑home inventory rose to 1.60 million units at the end of September, up 1.9% from August and 4.6% from a year earlier, providing a 4.8‑month supply—unchanged from August but up from 4.5 months a year ago.
