The Pending Homes Sales Index reported a 0.3% year-over-year decline and a 5.4% drop from May, indicating a sluggish housing market influenced by high mortgage rates and record home prices. Lawrence Yun, NAR's chief economist, noted that challenging conditions particularly affect first-time homebuyers. Regional trends show slight increases in pending sales in the Northeast and Midwest, while declines occurred in the South and West. Despite improved affordability measures, overall home sales remain slightly above last year's historic lows, with mortgage rates around 6.5% and median home prices nearing $441,000, marking a record high.

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Pending home sales dip in June as high mortgage rates, prices lead to 'tepid' market

Claire Boston· Senior Reporter

Thu, July 16, 2026 at 10:00 AM EDT1 min read

Home contract signings dropped in June in a sign of how record-high home prices and elevated mortgage rates are slowing buying and selling activity.

The Pending Homes Sales Index, which measures homes under contract, dropped 0.3% from a year earlier and 5.4% from May, according to National Association of Realtors data released on Thursday.

"The highest mortgage rates in nearly a year and the record-high national median home price together are contributing to a tepid housing market that is especially difficult for first-time homebuyers," NAR chief economist Lawrence Yun said in a statement.

Contract signing trends varied by location. In the Northeast, where inventory remains tight and the market is still tilted toward sellers, pending home sales were up 2.2% from a year earlier. The Midwest, which has attracted buyers due to its relative affordability, also saw a small uptick, while activity declined in the South and the West.

The housing market remains mired in a deep slump, with home sales so far this year tracking only slightly ahead of last year's multidecade low, even though affordability has improved by some metrics.

Mortgage rates hovered around 6.5% last month, slightly lower than in 2025 but still high enough to give many aspiring buyers pause. At the same time, the median sales price for an existing home reached a new record of nearly $441,000.

Homes typically go under contract a month or two before they're sold, making pending home sales an early indicator of future sales activity.

The Pending Homes Sales Index, which measures homes under contract, dropped 0.3% from a year earlier and 5.4% from May, according to National Association of Realtors data released on Thursday. (Reuters/Gary Cameron)·REUTERS / Reuters

Claire Boston is a Senior Reporter for Yahoo Finance covering housing, mortgages, and home insurance.

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