Pending sales of US homes drop to lowest level in 2026

The US housing market just delivered its worst monthly reading of the year. Pending home sales dropped 2.3% in July 2026 compared to the prior month, dragging the National Association of Realtors’ Pending Home Sales Index down to 71.2, its lowest mark since January.

The decline wasn’t confined to one corner of the country. All four major regions posted losses, with the West taking the hardest hit at a 4.7% monthly drop. Year-over-year, the picture looks even bleaker: pending sales fell 2.2% nationally, and the West cratered 7.1% compared to July 2025.

Peak rates met peak prices at the worst possible time

“The highest mortgage rates of the year hit during peak summer, pulling back contract signings,” said NAR Chief Economist Lawrence Yun.

Record home prices made matters worse. Median prices for existing homes climbed to somewhere between $431,400 and $434,100, setting new highs for the month of July.

The numbers tell a consistent story

Regional breakdowns paint a uniformly dreary picture. The Northeast saw pending sales fall 2.0% month-over-month, while the Midwest dipped a more modest 0.7%. The South, which accounts for the largest share of US home sales, declined 2.2%. And the West posted that standout 4.7% monthly decline.

Existing-home sales data released around the same time reinforced the trend. Completed transactions fell 1.7% in July to a seasonally adjusted annual rate of 4.06 million. Redfin’s own tracking pointed to near-record lows in buyer demand and pending activity.

Perhaps the most striking data point: pending contracts remain roughly 30% below where they were in 2019, before the pandemic reshuffled the entire housing market. That gap persists even though payroll employment has grown about 5% over the same period, according to Yun.

What to watch from here

Pending home sales are considered a leading indicator for the broader housing market because they measure signed contracts, not closed deals. A signed contract in July typically closes in August or September, meaning the existing-home sales numbers for the next couple of months are likely to reflect this weakness.

Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.