BAM Key Details:
- NAR’s September Pending Home Sales report shows a 7.3% month-over-month drop and an 11.3% year-over-year drop in pending home sales, with declines in all four regions.
- A 15.0% annual decline made the West the hardest-hit region, and the Northeast posted the smallest monthly decline at 4.2%.
- A 2.0% annual decline gave Nashville the smallest drop among the 50 largest metros, according to Realtor.com® Economics data cited in NAR’s release.
What do you tell a seller who wants to know why fewer offers are coming in this fall?
Pending home sales dropped 7.3% from August to September, according to NAR’s Pending Home Sales report.
Compared with the same time last year, September 2025, pending sales are down 11.3%. And on both counts, monthly and annual, they’re down in every region.
NAR’s chief economist, Dr. Lawrence Yun, says fast-rising mortgage rates are the main reason for the pullback. As of today, rates are hovering around 7.4%, and your buyers are looking at higher monthly payments at a time when everything is more expensive.
Here’s what the data is telling us and what it means for your conversations with sellers and buyers right now.
Pending Home Sales Fell in Every Region and Large Metro
The West took the biggest hit in September, and the Northeast had the smallest monthly decline.
Here’s how NAR’s September report breaks down each region’s numbers:
- Northeast: 4.2% decrease month-over-month, 9.4% decrease year-over-year
- Midwest: 6.5% decrease month-over-month, 8.7% decrease year-over-year
- South: 8.2% decrease month-over-month, 12.0% decrease year-over-year
- West: 9.2% decrease month-over-month, 15.0% decrease year-over-year
The decline reached the local level as well. Pending sales fell year-over-year in every one of the 50 largest metro areas, including the strongest markets.
According to data from Realtor.com® Economics, these 10 metros posted the smallest annual declines:
- Nashville-Davidson-Murfreesboro-Franklin, TN (-2.0%)
- Hartford-West Hartford-East Hartford, CT (-2.1%)
- San Francisco-Oakland-Fremont, CA (-3.5%)
- San Jose-Sunnyvale-Santa Clara, CA (-4.6%)
- Buffalo-Cheektowaga, NY (-5.6%)
- Richmond, VA (-5.8%)
- Austin-Round Rock-San Marcos, TX (-5.9%)
- Pittsburgh, PA (-6.2%)
- Memphis, TN-MS-AR (-6.3%)
- San Antonio-New Braunfels, TX (-7.1%)
NAR Chief Economist Ties the Drop to Mortgage Rates
In NAR’s release, Dr. Yun explained why the market cooled in September.
“Market conditions weakened in September due to fast-rising mortgage rates. Although job growth and income gains can support home purchases, housing affordability is more affected by changes in mortgage rates.”
When it comes to the rate outlook, Yun sees a possible peak with one big unknown.
“Given that mortgage rates have already risen much more than the Federal Reserve’s short-term interest rate hikes, mortgage rates could be topping out.
“However, increasing energy prices and the resulting inflationary pressure are highly uncertain.”
So, here’s what all this means for your conversations with buyers and homeowners this quarter and heading into 2027.
What September’s Numbers Mean for Seller and Buyer Conversations
Yun closed with a point about distressed properties, meaning foreclosures and short sales, and how they’re affecting home prices.
“Despite the difficulty of obtaining a mortgage, the limited number of distressed properties is ensuring steady home prices. Buyers and sellers may simply be holding back until mortgage rates move favorably.”
If you have clients on either side waiting for a better moment to move, his comments give you some options for opening those conversations.
With sellers, start with pricing. Fewer buyers are signing contracts, so your sellers need a price that fits the buyers in the market this fall. You can point to Yun’s comment on steady prices, since a small number of distressed homes means fewer bargain-priced listings competing for the same buyers.
With buyers, Yun’s outlook on rates gives you an opening to talk about timing. If your buyers are ready to move, you can remind them of a couple of things working in their favor:
- Fewer buyers under contract can mean less competition and more room to negotiate
- A purchase this fall leaves the door open to refinancing if rates come down
Yun called the inflation outlook highly uncertain, so you can’t promise lower rates.
Help your buyers compare the cost of waiting with today’s prices and rates, and bring in a lender to run the numbers on different rate scenarios.
