The buyers are out there — if the interest rates are right and the choices plentiful. That’s the news from the latest National Association of Realtors (NAR) report on pending home sales.
Pending homes sales jumped 7.4% in September, according to the report released Wednesday morning. All four regions experienced month-over-month gains.
“Contract signings rose across all regions of the country as buyers took advantage of the combination of lower mortgage rates in late summer and more inventory choices,” said NAR Chief Economist Lawrence Yun, in a statement. “Further gains are expected if the economy continues to add jobs, inventory levels grow, and mortgage rates hold steady.”
The Pending Home Sales Index is a forward-looking indicator of home sales based on contract signings. The index reached 75.8 in September, the highest level since March (78.3). An index of 100 is equal to the level of contract activity in 2001. Year-over-year, only the Northeast and West saw increases while the Midwest and South remained level.
Yun said the market has seen sluggish growth in 2023 and 2024. But he expects sales to grow in 2025 to 4.47 million and more than 5 million in 2026.
“During the next two years, expect a slower rate of growth in home prices that’s roughly in line with the consumer price index because of additional supply reaching the market,” Yun said.
The median existing-home price will rise to $410,700 in 2025 and to $420,000 in 2026, Yun predicted. The annual 30-year fixed mortgage rate will slide to 5.9% in 2025 but then move higher to 6.1% in 2026.
