Pending home sales sink to 25-year low as buyers flee high mortgage rates

Pending home sales fell in September to their lowest level in roughly 25 years, according to the report, as contract signings to purchase homes dropped to a record low. The decline coincided with the average 30-year mortgage rate moving above 7%, a threshold that sharply raises monthly payments for prospective buyers.

The data matters because pending sales are a leading indicator: they typically precede closings by a month or two, so September's weakness points to softer existing-home sales in the months ahead. The pattern is consistent with a rate-sensitive market in which affordability, rather than demand alone, is driving decisions. Buyers facing higher financing costs often pause, renegotiate expectations, or shift toward lower-priced segments, which can ripple through pricing and inventory.

What to watch: whether mortgage rates hold above 7% or ease, and whether that shift brings buyers back. Also monitor inventory levels and price cuts, which can signal how sellers are adapting. For broader markets, housing weakness can affect construction, home-improvement spending, and consumer sentiment — making upcoming sales and rate data key reference points.