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Pending home sales declined 9.3 percent month over month in December, as a dip in mortgage rates failed to outweigh consumers concerns about high home prices and the overall economy.
Pending home sales ended the year on a cold note, with December contract signings declining 9.3 percent month over month.
Month-over-month pending home sales declined in all four regions, the National Association of Realtors report said. Meanwhile, annual pending home sales declined 3 percent, with regional trends showing strength in the South and softness in the Northeast, Midwest and West.
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Lawrence Yun | Chief economist at the National Association of Realtors
“The housing sector is not out of the woods yet,” NAR Chief Economist Lawrence Yun said in a prepared statement. “After several months of encouraging signs in pending contracts and closed sales, the December new contract figures have dampened the short-term outlook.”
“Even after accounting for typical seasonal patterns, interpreting in-person home search activity in the winter – especially in December – can be tricky due to public holidays, people taking time off, and wintry weather conditions,” he added. “We’ll be watching the data in the coming months to determine whether the soft contract signings were a one-month aberration or the start of an underlying trend.”
Realtor.com Sr. Economic Research Analyst Hannah Jones said December’s dip in pending sales reflects consumers’ ongoing concerns about affordability and economic and labor market uncertainty. The decline in mortgage rates was not enough to offset these worries, Jones said, while noting the slump may continue well into 2026.
“Mortgage rates fell to their lowest level of the year in December, offering some relief on affordability, yet a lack of fresh listings dampened buyer enthusiasm,” she said in an emailed statement. “While active inventory rose 12.1 percent year over year, new listings declined 1.8 percent, leaving buyers with fewer newly available options to choose from.”
“December’s pending data suggests a slow start to the year in terms of home sales,” she added. “While easing mortgage rates and gradually improving supply have provided some support, the housing market remains in a low gear, with both buyer and seller activity still subdued.”
Bright MLS Chief Economist Lisa Sturtevant echoed similar sentiments in her analysis, saying that spring may yield a rush in homebuyer activity.
“[Wednesday’s] report shows that many others are taking a wait-and-see approach to see if market conditions become more favorable in 2026,” she said. “Buyers looking to get into the market this year will generally find more inventory and greater opportunities to negotiate on price and concessions. Sellers wanting a quick sale will need to price appropriately to entice economically anxious buyers.”
