Pending home sales fall sharply in June as high mortgage rates and record prices bite

Pending home sales in the United States dropped more than expected in June, snapping a four-month streak of gains and underscoring the persistent affordability crisis in the housing market. The National Association of Realtors reported that its Pending Home Sales Index fell 5.4% month over month to 72.5, a decline that was steeper than analysts had anticipated and the largest since December, according to multiple outlets including Business Times and KRWK.

KRWKUS pending home sales slump in June amid affordability challenges

Contract signings decreased month over month in all four major U.S. regions, the Manila Times reported, though year-over-year trends were mixed: the Northeast and Midwest saw increases while the South and West posted declines. The data covers homes that are under contract but not yet closed, making it a forward-looking indicator for the housing market.

Manila TimesNAR Pending Home Sales Report Shows 5.4% Decrease in June

"The highest mortgage rates in nearly a year and the record-high national median home price together are contributing to a tepid housing market"

The association pointed to the dual headwinds of elevated borrowing costs and sky-high prices as the core drag on demand. June's mortgage rates were the highest in nearly a year, compounding the strain on buyers already grappling with stressed household budgets.

CNBC reported that the market is struggling under a "trifecta of high mortgage rates, record home prices, and stressed consumers." Neil's Newsletter noted that the level of pending sales "remains historically low," even after the brief run of gains earlier in the spring.

"The housing market is struggling in summer 2025 due to a trifecta of high mortgage rates, record home prices, and stressed consumers."

The combination of unaffordability and limited inventory continues to keep many would-be buyers on the sidelines, and builders face similar cost pressures. With the Fed signaling no near-term rate relief, the summer doldrums look set to extend deeper into the year.