Pending home sales fell by 2.3% in July, compared with a flat reading expected in survey compiled by Bloomberg as of 7:45 am ET and following a 4.8% decrease in June, according to the National Association of Realtors.
The monthly sales index was down 2.2% from July 2025.
Pending home sales declined in all four regions of the country from June, while it declined in three of the four regions compared with a year earlier, rising only in the Midwest region.
"The highest mortgage rates of the year hit right in the middle of summer, and that's pulling back contract signings," said NAR Chief Economist Lawrence Yun. "Home prices are at record highs so houses for sale are sitting on the market longer, and fewer buyers are bidding above the asking price than a year ago, though there are large local market variations."
If mortgage rates hold steady or decline, more buyers could be brought into the market by job gains, Yun added.
"Right now, pending contracts are 30% below their pre-pandemic 2019 level, while payroll employment is 5% above," Yun said. "That gap points to sizable pent-up demand that should be unleashed in the coming years as more supply reaches the market and affordability improves."
August existing-home sales data are scheduled for release on September 10.