Pending sales of existing US homes stalled in September, suggesting anxiety about the job market kept potential buyers sidelined despite a welcome easing in mortgage rates.
An index of contract signings held at 74.8 after climbing a revised 4.2% a month earlier to the highest level since March, according to National Association of Realtors data released Wednesday. Economists expected a 1.2% increase, based on the median estimate in a Bloomberg survey.
"A record-high stock market and growing housing wealth in September were not enough to offset a likely softening job market," NAR Chief Economist Lawrence Yun said in a statement. Nonetheless, "mortgage rates are trending toward three-year lows, which should further improve affordability, though the government shutdown could temporarily slow home sales activity."
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Even with middling results for last month, housing economists see the resale market slowly thawing after several years of lackluster demand.
Moreover, the so-called "lock-in effect" — in which homeowners resist selling because of their existing low-rate mortgages — is waning and helping to boost inventory.
Figures out Tuesday from S&P Cotality Case-Shiller showed buyers are gaining leverage in negotiations with sellers. A national measure of home prices rose 1.5% in August from a year ago, the smallest annual gain since mid-2023.
By region, contract signings on previously owned homes rose 1.1% in the South to the highest level since March. Pending sales also climbed in the Northeast, while falling in the West and Midwest.
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The broader housing market has experienced more momentum recently, with
Pending-homes sales tend to be a leading indicator for previously owned homes, as houses typically go under contract a month or two before they're sold.
