Pending home sales hit a record low.

What happened

Pending home sales fell 7.3% in September 2026 to the lowest level since the National Association of Realtors began its index in 2001, according to NAR data released on October 20. Pending sales are homes that are under contract but have not yet officially closed, so they are often viewed as an early sign of where the housing market may be headed.

The main issue is affordability

Mortgage rates have risen sharply, making monthly payments more expensive for buyers. Freddie Mac's weekly survey put the average 30-year fixed rate at 7.40% in mid-October, up from 5.98% in late February. Even people with steady jobs and rising incomes may find it harder to qualify for a home loan or feel comfortable taking on a larger payment.

High mortgage rates are also discouraging many current homeowners from moving. A large share of existing homeowners have mortgages with much lower interest rates than what is available today. Selling their home could mean giving up a cheaper loan and replacing it with a much more expensive one, so many are choosing to stay put. Research from the Federal Housing Finance Agency has found that this lock-in effect makes owners measurably less likely to sell.

A slowdown across the market

The slowdown is being felt across the housing market. Buyers are more cautious, sellers have fewer active shoppers, and builders are seeing weaker demand. Major homebuilders have also pointed to affordability problems as a reason for softer sales. Lennar, for example, said in September that affordability remains the defining constraint.

What it means for buyers and sellers

For everyday buyers, the takeaway is that the housing market remains difficult. Higher borrowing costs are keeping many people on the sidelines, even when they want to buy. For sellers, it may mean homes take longer to sell, and pricing realistically is becoming more important.